Allogeneic stem cell transplantation is one of the curative treatments for patients with hematologic malignancies and nonmalignant disorders. Unfortunately, the majority of patients hardly find a matching sibling donor who supposedly is human leukocyte antigen compatible. Limiting factors such as graft-versus-host disease (GVHD) toxicity have led in to the explorative study of umbilical cord blood (UCB) as an alternative source of hematopoietic stem cells. The unique immunologic properties of UCB likely minimize the risk of GVHD. Thus, UCB provides a highly convenient hematopoietic stem cells source that may significantly expand the HSC donor pool. This overview study considers the advantages and disadvantages of UCB as a donor source and outlines the current status of UCB transplantation, with emphasis herein on pediatric clinical practice. Strategies to improve kinetics of hematopoietic recovery after UCB grafting in children and adults are disucssed.