Traumatic brain injury (TBI) is a brain injury resulting from blunt mechanical external forces, which is a crucial public health and socioeconomic problem worldwide. TBI is one of the leading causes of death or disability. The primary injury of TBI is generally irreversible. Secondary injury caused by neuroinflammation could result in exacerbation of patients, which indicated that anti-inflammation and immunomodulatory were necessary for the treatment of TBI. Accumulated evidence reveals that the transplantation of umbilical cord mesenchymal stem cells (UCMSCs) could regulate the microenvironment in vivo and keep a balance of helper T 17(Th17)/ regulatory T cell (Treg). Therefore, it is reasonable to hypothesize that the UCMSCs could repair neurological impairment by maintaining the balance of Th17/Treg after TBI. In the study, we observed the phenomenon of trans-differentiation of T lymphocytes into Th17 cells after TBI. Rats were divided into Sham, TBI, and TBI + UCMSCs groups to explore the effects of the UCMSCs. The results manifested that trans-differentiation of Th17 into Treg was facilitated by UCMSCs, which was followed by promotion of neurological recovery and improvement of learning and memory in TBI rats. Furthermore, UCMSCs decreased the phosphorylation of nuclear factor-kappa B (NF-κB) and increased the expression of mothers against decapentaplegic homolog 3 (Smad3) in vivo and vitro experiments. In conclusion, UCMSCs maintained Th17/Treg balance via the transforming growth factor-β (TGF-β)/ Smad3/ NF-κB signaling pathway.