Mesenchymal stem/stromal cells (MSCs) represent a promising cell source for research and therapeutic applications, but their restricted ex vivo propagation capabilities limit putative applications. Substantial self-renewing of stem cells can be achieved by reprogramming cells into induced pluripotent stem cells (iPSCs) that can be easily expanded as undifferentiated cells even in mass culture. Here, we investigated a differentiation protocol enabling the generation and selection of human iPSC-derived MSCs exhibiting relevant surface marker expression profiles (CD105 and CD73) and functional characteristics. We generated such iPSC-MSCs from fibroblasts and bone marrow MSCs utilizing two different reprogramming constructs. All such iPSC-MSCs exhibited the characteristics of normal bone marrow-derived (BM) MSCs. In direct comparison to BM-MSCs our iPSC-MSCs exhibited a similar surface marker expression profile but shorter doubling times without reaching senescence within 20 passages. Considering functional capabilities, iPSC-MSCs provided supportive feeder layer for CD34(+) hematopoietic stem cells' self-renewal and colony forming capacities. Furthermore, iPSC-MSCs gained immunomodulatory function to suppress CD4(+) cell proliferation, reduce proinflammatory cytokines in mixed lymphocyte reaction, and increase regulatory CD4(+)/CD69(+)/CD25(+) T-lymphocyte population. In conclusion, we generated fully functional MSCs from various iPSC lines irrespective of their starting cell source or reprogramming factor composition and we suggest that such iPSC-MSCs allow repetitive cell applications for advanced therapeutic approaches.