PURPOSE To explore the value of transplanting peripheral blood-derived mesenchymal stem cells from allogenic rabbits (rPBMSCs) to treat osteonecrosis of the femoral head (ONFH). MATERIALS AND METHODS rPBMSCs were separated/cultured from peripheral blood after granulocyte colony-stimulating factor mobilization. Afterwards, mobilized rPBMSCs from a second passage labeled with PKH26 were transplanted into rabbit ONFH models, which were established by liquid nitrogen freezing, to observe the effect of rPBMSCs on ONFH repair. Then, the mRNA expressions of BMP-2 and PPAR-γ in the femoral head were assessed by RT-PCR. RESULTS After mobilization, the cultured rPBMSCs expressed mesenchymal markers of CD90, CD44, CD29, and CD105, but failed to express CD45, CD14, and CD34. The colony forming efficiency of mobilized rPBMSCs ranged from 2.8 to 10.8 per million peripheral mononuclear cells. After local transplantation, survival of the engrafted cells reached at least 8 weeks. Therein, BMP-2 was up-regulated, while PPAR-γ mRNA was down-regulated. Additionally, bone density and bone trabeculae tended to increase gradually. CONCLUSION We confirmed that local transplantation of rPBMSCs benefits ONFH treatment and that the beneficial effects are related to the up-regulation of BMP-2 expression and the down-regulation of PPAR-γ expression.