Transplanted human bone marrow (BM) and umbilical cord blood (UCB) progenitor cells activate islet-regenerative or revascularization programs depending on the progenitor subtypes administered. Using purification of multiple progenitor subtypes based on a conserved stem cell function, high aldehyde dehydrogenase (ALDH) activity (ALDH(hi)), we have recently shown that transplantation of BM-derived ALDH(hi) progenitors improved systemic hyperglycemia and augmented insulin secretion by increasing islet-associated proliferation and vascularization, without increasing islet number. Conversely, transplantation of culture-expanded multipotent-stromal cells (MSCs) derived from BM ALDH(hi) cells augmented total beta cell mass via formation of beta cell clusters associated with the ductal epithelium, without sustained islet vascularization. To identify paracrine effectors produced by islet-regenerative MSCs, culture-expanded BM ALDH(hi) MSCs were transplanted into streptozotocin-treated nonobese diabetic/severe combine immune deficient (SCID) mice and segregated into islet-regenerative versus nonregenerative cohorts based on hyperglycemia reduction, and subsequently compared for differential production of mRNA and secreted proteins. Regenerative MSCs showed increased expression of matrix metalloproteases, epidermal growth factor receptor (EGFR)-activating ligands, and downstream effectors of Wnt signaling. Regenerative MSC supernatant also contained increased levels of pro-angiogenic versus pro-inflammatory cytokines, and augmented the expansion of ductal epithelial but not beta cells in vitro. Conversely, co-culture with UCB ALDH(hi) cells induced beta cell but not ductal epithelial cell proliferation. Sequential transplantation of MSCs followed by UCB ALDH(hi) cells improved hyperglycemia and glucose tolerance by increasing beta cell mass associated with the ductal epithelium and by augmenting intra-islet capillary densities. Thus, combinatorial human progenitor cell transplantation stimulated both islet-regenerative and revascularization programs. Understanding the progenitor-specific pathways that modulate islet-regenerative and revascularization processes may provide new approaches for diabetes therapy.