Peripheral arterial disease remains an often devastating condition, particularly in patients with diabetes, because of the high rate of functional disability, amputation and death. For those patients for whom conventional endovascular or surgical revascularization procedures have been unsuccessful, new options are eagerly awaited, among which cell therapy has gained increasing interest. Most clinical trials of cell therapy have used multiple intramuscular injections of bone marrow-derived mononuclear cells that have yielded encouraging suggestions of efficacy. The prevailing opinion is that the benefits of cell therapy are not a result of the structural integration of grafted cells within new vessels, but of the paracrine activation of angiogenesis, arteriogenesis and vasculogenesis pathways by the cytokines, chemokines and growth factors released from such cells. An analysis of cell therapy clinical trial outcomes has also identified several key issues that need to be addressed, including the optimal cell type, source and dosing, the most effective route for cell transfer, and methods for enhancing survival of the cellular graft. Finally, because of the strong placebo effect that may confound interpretation of outcome measures, rigorously randomized controlled trials are mandatory in order to assess more thoroughly whether cell therapy will be beneficial for patients with peripheral arterial disease. © 2010 Thomson Reuters (Scientific) Ltd.