Stem-cell therapy for myocardial tissue repair is limited by the poor survival of transplanted cells, possibly due to inadequate supply of oxygen and nutrients. The purpose of this study was to assess the oxygenation level and functional recovery after allogenic transplantation of mesenchymal stem cells (MSC) in a rat model of myocardial infarction. Myocardial oxygen tension (pO₂) was measured by electron paramagnetic resonance (EPR) oximetry using an implantable oxygen-sensing spin probe (OxySpin). MSCs incubated with OxySpins showed substantial uptake of the probe without affecting its oxygen sensitivity or calibration. The cells internalized with OxySpins were able to differentiate into osteogenic, adipogenic, cardiomyocyte, and endothelial cell lineages. The labeled cells tested positive for CD44 and CD29 markers and negative for the hematopoietic markers CD14 and CD45. For the in vivo studies, myocardial infarction (MI) was induced in rats by permanently ligating the left-anterior-descending coronary artery. MSCs with OxySpins were transplanted in the infarct region of hearts. A significant increase in pO₂ was observed in the MSC group as compared to the untreated MI group (18.1±2.6 versus 13.0±1.8 mmHg, N=4, p<0.05) at 4 weeks after transplantation. Echocardiography showed a significant improvement in ejection fraction and fraction shortening which inversely correlated with the magnitude of fibrosis in the treated hearts. The cell-transplanted hearts also showed an increase in VEGF level and capillary density in the infarct region. The study established our ability to measure and correlate changes in myocardial tissue oxygenation with cardiac function in infarcted rat hearts treated with MSCs.