Bone marrow transplantation is a curative procedure for several malignant and non-malignant diseases. The major limitation for the use of HLA-matched related sibling donors in BMT has been the fact that only 30 to 40% of the candidates are likely to have an HLA-matched relative. Alternative donors may be found among volunteers listed in large registries such as the NMDP. However, a fully matched donor can be identified only for a minority of patients. For patients without suitably matched unrelated or family donors, either related or unrelated umbilical cord blood (UCB) have been used with success. As a source of stem cells, placental blood has several potential advantages. There is no risk to the donor, cryopreserved cells are promptly available and there is a lower risk of transmitting CMV, EBM or other infections. Since there seems to exist a lower risk of GVHD, one may permit greater HLA disparity. CB lymphocytes, although naive, have a fully constituted T-cell receptor chain repertoire. There are no clonal expansions of alloreactive cells in CB and CB lymphocytes produce less I L-2, I L-4, IFN-gamma, and TNF-alfa than adult lymphocytes. However, lymphokine activated killer (LAK) cells from CB have been shown to have a higher necrosis and apoptotic-mediated cytotoxicity in vitro, when compared to BM LAK cells. IL-2 induces increases in granzyme B activity in CB but not in BM cells. Taken together, these facts suggest that CB may have a higher potential for a graft-versus-leukemia effect, with less GVHD. Due to the low total number of progenitor cells in UCB, the majority of transplants performed have been done in children or adults with less than 50 Kg. Results are generally better for related than unrelated transplants, but this may be partly justified by inclusion of worse prognosis patients in studies involving unrelated UCB transplant.