This study explored the novel strategy of hypoxic preconditioning of bone marrow mesenchymal stem cells before transplantation into the infarcted heart to promote their survival and therapeutic potential of mesenchymal stem cell transplantation after myocardial ischemia. Mesenchymal stem cells from green fluorescent protein transgenic mice were cultured under normoxic or hypoxic (0.5% oxygen for 24 hours) conditions. Expression of growth factors and anti-apoptotic genes were examined by immunoblot. Normoxic or hypoxic stem cells were intramyocardially injected into the peri-infarct region of rats 30 minutes after permanent myocardial infarction. Death of mesenchymal stem cells was assessed in vitro and in vivo after transplantation. Angiogenesis, infarct size, and heart function were measured 6 weeks after transplantation. Hypoxic preconditioning increased expression of pro-survival and pro-angiogenic factors including hypoxia-inducible factor 1, angiopoietin-1, vascular endothelial growth factor and its receptor, Flk-1, erythropoietin, Bcl-2, and Bcl-xL. Cell death of hypoxic stem cells and caspase-3 activation in these cells were significantly lower compared with that in normoxic stem cells both in vitro and in vivo. Transplantation of hypoxic versus normoxic mesenchymal stem cells after myocardial infarction resulted in an increase in angiogenesis, as well as enhanced morphologic and functional benefits of stem cell therapy. Hypoxic preconditioning enhances the capacity of mesenchymal stem cells to repair infarcted myocardium, attributable to reduced cell death and apoptosis of implanted cells, increased angiogenesis/vascularization, and paracrine effects.