Mesenchymal stem cells (MSCs) are considered a promising regenerative therapy due to their ability to migrate toward damaged tissues. The homing ability of MSCs is unique compared with that of non-migrating cells and MSCs are considered promising therapeutic vectors for targeting major cells in many pathophysiological sites. MSCs have many advantages in the treatment of malignant diseases, particularly rheumatoid arthritis (RA). RA is a representative autoimmune disease that primarily affects joints, and secreted chemokines in the joints are well recognized by MSCs following their migration to the joints. Furthermore, MSCs can regulate the inflammatory process and repair damaged cells in the joints. However, the functionality and migration ability of MSCs injected in vivo still show insufficient. The targeting ability and migration efficiency of MSCs can be enhanced by genetic engineering or modification, eg, overexpressing chemokine receptors or migration-related genes, thus maximizing their therapeutic effect. However, there are concerns about genetic changes due to the increased probability of oncogenesis resulting from genome integration of the viral vector, and thus, clinical application is limited. Furthermore, it is suspected that administering MSCs can promote tumor growth and metastasis in xenograft and orthotopic models. For this reason, MSC mimicking nanoencapsulations are an alternative strategy that does not involve using MSCs or bioengineered MSCs. MSC mimicking nanoencapsulations consist of MSC membrane-coated nanoparticles, MSC-derived exosomes and artificial ectosomes, and MSC membrane-fused liposomes with natural or genetically engineered MSC membranes. MSC mimicking nanoencapsulations not only retain the targeting ability of MSCs but also have many advantages in terms of targeted drug delivery. Specifically, MSC mimicking nanoencapsulations are capable of encapsulating drugs with various components, including chemotherapeutic agents, nucleic acids, and proteins. Furthermore, there are fewer concerns over safety issues on MSC mimicking nanoencapsulations associated with mutagenesis even when using genetically engineered MSCs, because MSC mimicking nanoencapsulations use only the membrane fraction of MSCs. Genetic engineering is a promising route in clinical settings, where nano-encapsulated technology strategies are combined. In this review, the mechanism underlying MSC homing and the advantages of MSC mimicking nanoencapsulations are discussed. In addition, genetic engineering of MSCs and MSC mimicking nanoencapsulation is described as a promising strategy for the treatment of immune-related diseases.