Cultured mesenchymal stromal cell (MSC) populations are best characterized by the capacity of some cells within this population to differentiate into mesodermal derivatives such as osteoblasts, chondrocytes and adipocytes. However, this progenitor property is not shared by all cells within the MSC population. Furthermore, MSCs exhibit variability in their phenotypes, including proliferation capacity, expression of cell surface markers and ability to secrete cytokines. These facts raise three major questions: (1) Does the in vitro observed variability reflect the existence of MSC subsets in vivo? (2) What is the molecular basis of the in vitro observed heterogeneity? and (3) What is the biological significance of this variability? This review considers the possibility that the variable nature of MSC populations contributes to the capacity of adult mammalian tissues to adapt to varying microenvironmental demands.