Hyperoxia induces activation of the renin-angiotensin system (RAS) in newborn rat lungs. This study investigated the therapeutic effects of human mesenchymal stem cells (MSCs) on lung development and RAS expression in neonatal rats exposed to hyperoxia. Sprague-Dawley rat pups were exposed to either room air (RA) or oxygen-enriched atmosphere (O) treatment from postnatal days 1 to 14. Human MSCs (1 × 10 cells) in 0.03 mL of normal saline (NS) were administered intratracheally on postnatal day 5, and four study groups were obtained: RA + NS, RA + MSCs, O + NS, and O + MSCs. The lungs were excised for cytokine, expression of RAS components, and histological analyses on postnatal day 14. Body and lung weights were significantly lower in rats reared in hyperoxia than in those reared in RA. The rats reared in hyperoxia and treated with NS exhibited significantly higher tumor necrosis factor (TNF)-α and interleukin (IL)-6 levels, mean linear intercept (MLI), and expression of angiotensin II, angiotensin II type 1 receptor, and angiotensin-converting enzyme than those reared in RA and treated with NS or MSCs did. Administering MSC to hyperoxia-exposed rats reduced TNF-α and IL-6 levels, improved MLI, and decreased expression of angiotensin II, angiotensin II type 1 receptor, and angiotensin-converting enzyme to normoxic levels. Thus, human MSCs attenuated hyperoxia-induced lung injury through inhibition of the RAS in newborn rats.