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Up to now, there are few reports addressing the biological properties and differentiation potential of umbilical cord blood-derived mesenchymal stem cells (UCB-MSCs).To observe the biological characteristics, osteogenic and adipogenic differentiation potential of UCB-MSCs.MSCs were harvested and cultured from UCB at various gestational ages (GA). Harvested UCB-MSCs were cultured primarily and subcultured, and then induced to differentiate into osteoblasts and adipocytes.Under the inverted phase contrast microscope, UCB-MSCs adhered to the wall, showing fibroblast like morphology and whirlpool like growth alignment. Observation of the ultramicrostructure under transmission electron microscope showed that UCB-MSCs had a big cell nucleus, fewer cellular organelles and big karyoplasmic ratio. All of the growth curves of primary and passaged UCB-MSCs presented S-shaped. The 3rd and 5th passages of MSCs showed the strongest proliferation activity. The count of colony forming unit fibroblasts varied with GA, significant difference was found among the three GA groups (P < 0.05), and the lower GA group had a higher count of colony forming unit fibroblasts than that in the older GA group. Flow cytometry showed that these cells expressed CD29, CD44 and CD90 positively, but they failed to express hematopoiesis related molecules such as CD34 and CD45. When the MSCs were induced to osteogenic and adipogenic differentiation for 3 weeks, strong expression of alkaline phosphatase was found and the formation of a mineral extracellular matrix was detected by alizarin red staining were detected; and neutral lipid vacuoles were detected by oil red O staining. UCB-MSCs have similar morphological and biological characteristics and cell surface molecule markers with MSCs derived from bone marrow, both of which have great capability of proliferation and regeneration. UCB-MSCs can be induced to osteoblasts and adipocytes in a suitable condition in vitro.