Mesenchymal stem cells (MSCs) has been reported as multipotent progenitor cells that can be expanded rapidly in vitro and differentiated into multiple mesodermal cell type. Human MSCs have been reported to be associated with neural differentiation especially in the cholinergic phenotype in several neural system. In this study, We investigated the ability of MSCs derived human aipose tissue to differentiation into neural cells expressing Islet-1 and further differentiates into cholinergic neurons in cholinergic differentiation media. Immunocytochemistry was performed to detect the expression of Islet-1 and demonstrate characteristic of neurons and cholinergic neurons. Islet-1 was massively detected in the induction stage. Following cholinergic differentiation from Islet-1-expressing MSCs, Cholinergic neuron marker ChAT was higly expressed. Also we examined the neuroprotective effects and neural differentiation of transplanted human adipose tissue-derived mesenchymal stem cells (AT-MSCs) in ischemic stroke. For transplantation, after 3days after MCAO. animal were divided into 2 group: Group A : injected phosphate buffered saline (PBS;5 ㎕ n=10), Group B: transplanted AT-MSCs (5×105 cells, n=10). Each animal received an injection into the right penumbra region (from bregma : AP;－1.3 ㎜, ML;－4.0 ㎜, DV;－5.9 ㎜). In all animals, behavior test were performed at 1, 3, 6, 9, 12, 15 days after MCAO, that was conducted by investigators who were blined to the experimental groups. mNSS test demonstrated that motor, sensory, and balance behavior were impaired after MCAO ischemic insult. Ischemic rats that received AT-MSCs exhibited significantly improved functional performance compared with PBS injected animals and histological analysis revealed that transplanted AT-MSCs expressed marker for neuron. These results suggest that AT-MSCs can be differentiated into neuron especially in cholinergic neuron and may be a potential source of treatment for neurodegenerative disease such as stroke.