BACKGROUND: Mesenchymal stem cells (MSCs) have been shown to reduce sepsis-induced inflammation and improve survival in mouse models of sepsis. CD16(+) monocytes are proinflammatory and abundant in inflammatory conditions such as sepsis. The primary objective in this exploratory study was to determine the effects of adipose-derived MSCs (ASCs) on three subsets of monocytes from sepsis patients in vitro and to delineate the underlying mechanism. METHODS: This is a prospective cohort study of patients admitted to the medical intensive care unit (ICU) at an academic medical center. The levels of CD14(++)CD16(+), CD14(+)CD16(++), and CD14(++)CD16(-) monocytes from 23 patients in the early phase of severe sepsis or septic shock as well as 25 healthy volunteers were determined via flow cytometry after coculture with or without ASCs. To determine the molecular mechanisms, the effects of exogenous prostaglandin E2 (PGE2) and the cyclooxygenase-2 (COX-2) inhibitor NS-398 on monocyte phenotypes and cytokine expression were also examined. RESULTS: Basal levels of CD14(++)CD16(+) but not CD14(+)CD16(++) monocytes were significantly elevated in severe sepsis and septic shock. A positive linear relationship existed between the levels of CD14(++)CD16(+) monocytes and the Acute Physiology and Chronic Health Evaluation (APACHE) II score as well as Sequential Organ Failure Assessment (SOFA) score. Coculture of ASCs with monocytes from sepsis patients for 24 h significantly reduced CD14(++)CD16(+) expression while increasing the CD14(++)CD16(-) phenotype. The coculture also significantly elevated PGE2, COX-2, and prostaglandin E2 receptor (EP)4 levels generated from monocytes. Functionally, ASCs reduced the tumor necrosis factor (TNF)-α and increased the interleukin (IL)-10 secretion in monocytes of septic patients. Furthermore, the effects of ASCs on the CD14(++)CD16(+) phenotype and cytokine expression were mimicked by exogenous PGE2 and abolished by the COX-2 inhibitor NS-398. Additionally, ASCs also modified levels of monocyte phenotypes in a mouse model of sepsis. CONCLUSIONS: Levels of CD14(++)CD16(+) monocytes positively correlate with disease severity scores in the early phase of severe sepsis and septic shock. ASCs switch monocytes of sepsis patients from CD14(++)CD16(+) to CD14(++)CD16(-) in vitro and modulate the production of inflammatory cytokines. The immunomodulatory effect of ASCs on monocytes is PGE2-dependent. ASCs may exert their therapeutic effect on sepsis via altering monocyte phenotypes and functions.