In recent years, there has been notable progress in applying stem cell therapies for both acute and chronic pulmonary diseases. Among these, mesenchymal stromal cells (MSCs) have shown promise due to their regenerative potential, anti-inflammatory properties, and immunomodulatory functions. Despite encouraging results from preclinical models and select clinical trials, no stem cell-based therapy has received formal approval for the treatment of lung disease, largely due to inconsistent findings and methodological limitations. As lung disease continues to be a major global health burden, the need to move beyond symptom management toward treatment that can reverse or repair pulmonary damage has become increasingly urgent. This chapter explores the current landscape of lung regeneration research, emphasizing the biological mechanisms of MSCs, their role in disease modulation, and the challenges that must be addressed to bring these therapies into mainstream clinical use.