Umbilical cord blood-derived marrow stromal cells (UCB-MSCs) with high proliferation capacity and immunomodulatory properties are considered to be a good candidate for cell-based therapies. But until now, little work has been focused on the differentiation of UCB-MSCs. In this work, UCB-MSCs were demonstrated to be negative for CD34 and CD45 expression but positive for CD90 and CD105 expression. The gate values of UCB-MSCs for CD90 and CD105 were 99.3 and 98.6 %, respectively. Two weeks after treatment, the percentage of neuron-like cells differentiated from UCB-MSCs was increased to 84 ± 12 % in the experimental group [treated with olfactory ensheathing cells (OECs)-conditioned medium] and they were neuron-specific enolase positive; few neuron-like cells were found in the control group (without OECs-conditioned medium). Using whole-cell recording, sodium and potassium currents were recorded in UCB-MSCs after differentiation by OECs. Thus, human UCB-MSCs could be differentiated to neural cells by secreted secretion from OECs and exhibited electrophysiological properties similar to mature neurons after 2 weeks post-induction. These results imply that OECs can be used as a new strategy for stem cell differentiation and provide an alternative neurogenesis pathway for generating sufficient numbers of neural cells for cell therapy.