The identification of molecules that regulate human hematopoietic stem cells has focused mainly on cytokines, of which very few are known to act directly on stem cells. Recent studies in lower organisms and the mouse have suggested that bone morphogenetic proteins (BMPs) may play a critical role in the specification of hematopoietic tissue from the mesodermal germ layer. Here we report that BMPs regulate the proliferation and differentiation of highly purified primitive human hematopoietic cells from adult and neonatal sources. Populations of rare CD34+CD38−Lin− stem cells were isolated from human hematopoietic tissue and were found to express the BMP type I receptors activin-like kinase (ALK)-3 and ALK-6, and their downstream transducers SMAD-1, -4, and -5. Treatment of isolated stem cell populations with soluble BMP-2, -4, and -7 induced dose-dependent changes in proliferation, clonogenicity, cell surface phenotype, and multilineage repopulation capacity after transplantation in nonobese diabetic/severe combined immunodeficient (NOD/SCID) mice. Similar to transforming growth factor β, treatment of purified cells with BMP-2 or -7 at high concentrations inhibited proliferation yet maintained the primitive CD34+CD38− phenotype and repopulation capacity. In contrast, low concentrations of BMP-4 induced proliferation and differentiation of CD34+ CD38−Lin− cells, whereas at higher concentrations BMP-4 extended the length of time that repopulation capacity could be maintained in ex vivo culture, indicating a direct effect on stem cell survival. The discovery that BMPs are capable of regulating repopulating cells provides a new pathway for controlling human stem cell development and a powerful model system for studying the biological mechanism of BMP action using primary human cells.