- Intraperitoneal transplantation of human umbilical cord blood (hUCB) cells has been shown to reduce sensorimotor deficits after hypoxic ischemic brain injury in neonatal rats. However, the neuronal correlate of the functional recovery and how such a treatment enforces plastic remodelling at the level of neural processing remains elusive. Here we show by in-vivo recordings that hUCB cells have the capability of ameliorating the injury-related impairment of neural processing in primary somatosensory cortex. Intact cortical processing depends on a delicate balance of inhibitory and excitatory transmission, which is disturbed after injury. We found that the dimensions of cortical maps and receptive fields, which are significantly altered after injury, were largely restored. Additionally, the lesion induced hyperexcitability was no longer observed in hUCB treated animals as indicated by a paired-pulse behaviour resembling that observed in control animals. The beneficial effects on cortical processing were reflected in an almost complete recovery of sensorimotor behaviour. Our results demonstrate that hUCB cells reinstall the way central neurons process information by normalizing inhibitory and excitatory processes. We propose that the intermediate level of cortical processing will become relevant as a new stage to investigate efficacy and mechanisms of cell therapy in the treatment of brain injury.