Adenovirus-mediated gene therapies against brain tumors have been limited by the difficulty in tracking glioma cells infiltrating the brain parenchyma. Human umbilical cord blood-derived mesenchymal stem cells (UCB-MSC) are particularly attractive cells for clinical use in cell-based therapies. In the present study, we evaluated the tumor targeting properties and antitumor effects of UCB-MSCs as gene delivery vehicles for glioma therapy. We efficiently engineered UCB-MSCs to deliver a secretable trimeric form of tumor necrosis factor-related apoptosis-inducing ligand (stTRAIL) via adenoviral transduction mediated by cell-permeable peptides. We then confirmed the migratory capacity of engineered UCB-MSCs toward tumor cells by an in vitro migration assay and by in vivo injection of UCB-MSCs into the tumor mass or the opposite hemisphere of established human glioma in nude mice. Moreover, in vitro coculture, experiments on Transwell plates, and in vivo survival experiments showed that MSC-based stTRAIL gene delivery has more therapeutic efficacy compared with direct injection of adenovirus encoding the stTRAIL gene into a tumor mass. In vivo efficacy experiments showed that intratumoral injection of engineered UCB-MSCs (MSCs-stTRAIL) significantly inhibited tumor growth and prolonged the survival of glioma-bearing mice compared with controls. These results suggest that human UCB-MSCs have potential use as effective delivery vehicles for therapeutic genes in the treatment of intracranial glioma.