The present invention provides compositions comprising mesenchymal stem cells (MSCs), and methods for their novel use in the repair of cardiac damage and treatment of inflammatory diseases. The invention also provides methods for using TSG-6 protein that is secreted by MSCs under certain conditions, for repair of cardiac damage and inflammatory disease. The compositions of the invention may be particularly useful in restoring cardiac function following cardiac damage, including, but not limited to, myocardial infarction, as well as in reducing symptoms of inflammatory disease.