Stem cell transplantation represents a promising therapy for central nervous system injuries, but its application to Alzheimer’s disease (AD) is still limited and the potential mechanism for cognition improvement remains to be elucidated. In the present study, we used Tg2576 mice which express AD-like pathological forms of amyloid precursor protein (APP) to investigate the effects of human umbilical cord mesenchymal stem cells (hUC-MSCs) intravenous transplantation on AD mice. Interestingly, hUC-MSCs transplantation significantly ameliorated cognitive function of AD mice without altering Aβ levels in hippocampus. Remarkably, hUC-MSCs transplantation reduced oxidative stress in hippocampus of AD mice by decreasing the level of malondialdehyde (MDA), increasing the level of nitric oxide (NO), enhancing the activity of superoxide dismutase (SOD) and neuronal nitric oxide synthase (nNOS). The mechanisms underlying the improved cognitive function may be linked to hippocampal neurogenesis and an up-regulation of neuronal synaptic plasticity related proteins levels including silent information regulator 1 (Sirt1), brain-derived neurotrophic factor (BDNF) and synaptophysin (SYN). Taken together, our findings suggest that hUC-MSCs can improve cognition of AD mice by decreasing oxidative stress and promoting hippocampal neurogenesis. These results suggest that modulating hUC-MSCs to generate excess neuroprotective factors could provide a viable therapy to treat AD.