Changes in oxygen concentrations affect many of the innate characteristics of stem and progenitor cells. Human mesenchymal stem cells (hMSCs) were maintained under hypoxic atmospheres (2% O-2) for up to seven in vitro passages. This resulted in approximately 30-fold higher hMSC expansion over 6 weeks without loss of multi-lineage differentiation capabilities. Under hypoxia, hMSCs maintained their growth-rates even after reaching confluence, resulting in the formation of multiple cell layers. Hypoxic hMSCs also displayed differences in the cell and nuclear morphologies as well as enhanced ECM formation and organization. These changes in cellular characteristics were accompanied by higher mRNA levels of Oct-4 and HIF-2 alpha, as well as increased expression levels of connexin-43, a protein used in gap junction formation. The results from this study demonstrated that oxygen concentrations affected many aspects of stem-cell physiology, including growth and in vitro development, and may be a critical parameter during expansion and differentiation. (C) 2007 Elsevier Inc. All rights reserved.