Cells in the umbilical cord stroma have gained attention in recent years; however, differentiation to certain lineages in humans has been demonstrated in few studies. Unlike bone marrow MSCs, human umbilical cord stroma cells (HUCSCs) are far from being well characterized. This study attempts to describe proliferation, structural, and differentiation properties of these cells to account for their exceptional nature in many aspects. Cellular dynamics, cellular structure, and the degree of transformations during expansion and differentiation into mesenchymal and neuronal lineages were examined in vitro over a 10-month period. Comparisons with human bone marrow MSCs regarding differentiation were performed. HUCSCs in culture revealed two distinct cell populations, type 1 and type 2 cells, that possessed differential vimentin and cytokeratin filaments. Corresponding cells were encountered in cord sections displaying region-specific localization. alpha-Smooth muscle actin and desmin filaments, which were evident in cord sections, diminished through passages. No difference was noted regarding type 1 and type 2 cells in differentiation to chondrogenic, adipogenic, and osteogenic lineages, whereas a preferential differentiation was noted in neuronal lineage. Relative success was achieved by production of chondrocytic spheres and osteogenic monolayers, whereas adipocytes were immature compared with bone marrow MSCs. The presence of neuronal markers suggests that they transform into a certain state of maturity under neurogenic induction. Conclusively, HUCSCs retain their original phenotype in culture without spontaneous differentiation, have a limited lifespan, and bear multipotent stem cell characteristics. Given these characteristics, they may be generally considered progenitor cells if manipulated under appropriate conditions and deserve further study to be potentially used in cell-based therapies.