Interleukin (IL)-10 is a contributing factor to neuroprotection of mesenchymal stem cell (MSC) transplantation after ischemic stroke. Our aim was to increase therapeutic effects by combining MSCs and ex vivo IL-10 gene transfer with an adeno-associated virus (AAV) vector using a rat transient middle cerebral artery occlusion (MCAO) model. SpragueDawley rats underwent 90 min MCAO followed by intravenous administration of MSCs alone or IL-10 gene-transferred MSCs (MSC/IL-10) at 0 or 3 hr after ischemia reperfusion. Infarct lesions, neurological deficits, and immunological analyses were performed within 7 days after MCAO. 0-hr transplantation of MSCs alone and MSC/IL-10 significantly reduced infarct volumes and improved motor function. Conversely, 3-hr transplantation of MSC/IL-10, but not MSCs alone, significantly reduced infarct volumes (p < 0.01) and improved motor function (p < 0.01) compared with vehicle groups at 72 hr and 7 days after MCAO. Immunological analysis showed that MSC/IL-10 transplantation significantly inhibits microglial activation and pro-inflammatory cytokine expression compared with MSCs alone. Moreover, overexpressing IL-10 suppressed neuronal degeneration and improved survival of engrafted MSCs in the ischemic hemisphere. These results suggest that overexpressing IL-10 enhances the neuroprotective effects of MSC transplantation by anti-inflammatory modulation and thereby supports neuronal survival during the acute ischemic phase.