Human cord blood derived-multipotent stem cells (CB-SCs) have been found to have immunomodulatory capabilities that can result in inhibition of immune activation. Clinically, when used to interact with apheresed peripheral blood mononuclear cells (PBMCs) before reinfusion, they can counteract inflammation and restore immune balance in patients with autoimmune diseases, including alopecia areata and type 1 diabetes. The present study aimed to explore the potential application of CB-SCs to control donor alloreactive responses involved in allogeneic hematopoietic cell transplantation, which often results in acute graft-versus-host disease (GVHD). Phenotypically, we demonstrated that CB-SCs express CD45, CD11b, and CD9 markers on the cell surface; express Oct3/4, a transcription factor for embryonic stem cells; are negative for CD3, CD14, and CD34 expression; and have low expression of HLA-DR. In an allogeneic mixed lymphocyte culture (MLC) using human CD4 T cell enriched PBMCs and allogeneic myeloid derived dendritic cells, direct coculture with CB-SCs decreased CD4 T cell proliferation and activation, as evidenced by a marked decrease in the expression of the late activation markers CD25 and HLA-DR and a reduction of the PKH26 cell proliferation membrane lipophilic marker. Cytokine profiling of MLC supernatants revealed decreased concentrations of inflammatory proteins, including IFN-γ, IL-17, IL-13, IL-2, IL-6, and MIP1-α, along with marked increases in IL-1RA, IP-10, and MCP-1 concentrations in the presence of CB-SCs. Furthermore, transwell MLC experiments revealed that a soluble component was partially responsible for the immunomodulatory effects of CB-SCs. In this regard, exosomal microvesicles (EVs) positive for CD9, CD63, and CD81 were found in CB-SC-derived, ultrafiltered, and ultracentrifuged culture supernatants. CB-SC-EVs inhibited T cell proliferation in allogeneic MLC, suggesting a potential mode of action in allogeneic responses. Finally, CB-SCs were evaluated for their cellular therapy potential in vivo and found to ameliorate the development of GVHD responses in a xenogeneic human PBMC-induced NSG mouse model. Taken together, our results indicate that CB-SCs can directly and indirectly attenuate alloreactive CD4 T cell activation and proliferation in vitro with a potentially related EV mode of action and may have potential as a cellular therapy to control donor T cell-mediated GVHD responses in vivo.