Interest in umbilical cord blood as an alternate source of hematopoietic stem cells is growing rapidly. Umbilical cord blood offers the clinician a source of hematopoietic stem cells that is rarely contaminated by latent viruses and is readily available. Moreover, the collection of umbilical cord blood poses no risk to the donor; there is no need for general anesthesia or blood replacement, and the procedure causes no discomfort. Whether cord blood lymphocytes are as likely to cause GVHD as lymphocytes from older individuals is unknown. Current clinical experience would suggest that the incidence may be low. Few of the patients transplanted with umbilical cord blood thus far have developed clinically significant GVHD, including recipients of HLA-disparate grafts. These results and associated laboratory findings pose intriguing possibilities for the future of umbilical cord blood stem cells in the setting of unrelated transplantation. With the marked incidence of grade 2-4 acute GVHD that is currently observed after unrelated bone marrow transplantation, a reduction in incidence or severity would be a major advancement in this field. In the setting of autologous trans-plantation, there are other intriguing possibilities; for example, cord blood may be an optimal source of pluripotential stem cells for gene therapy. The large-scale collection and storage of cord blood stem cells has become a reality. Pilot programs for the banking of unrelated umbilical cord blood have already begun in the United States and Europe. Not only is there the potential for reducing the time from search initiation to the time of donor stem cell acquisition but also there is the potential for reducing the risks associated with unrelated bone marrow transplantation. There is also the hope of remedying the shortage of donors from ethnic and racial backgrounds that are currently underrepresented in most unrelated donor programs. Even with the creation of such banks, it should not be forgotten that the collection of umbilical cord bloods should at least be considered when a child with leukemia, lymphoma, neuroblastoma, marrow failure syndrome, immunodeficiency state, or inborn error of metabolism has a mother who is pregnant. The clinical results to date in small recipients would suggest that it is at least as good as bone marrow; but additional patients and more time will be needed to finalize this conclusion.