Human mesenchymal stem/stromal cells (hMSCs) are a promising therapy for acute respiratory distress syndrome (ARDS) and other inflammatory conditions. While considerable research has focused on paracrine effects and mitochondrial transfer that improve lung fluid balance, hMSCs are well known to have immunomodulatory properties as well. Some of these immunomodulatory properties have been related to previously reported paracrine effectors such as indoleamine-2,3-dioxygenase (IDO), but these effects cannot fully account for cell-contact dependent immunomodulation. Here, we report that CD40 is upregulated on hMSCs under the same conditions previously reported to induce IDO. Further, CD40 transcription is also upregulated on hMSCs by ARDS pulmonary edema fluid but not by hydrostatic pulmonary edema fluid. Transcription of CD40, as well as paracrine effectors TSG6 and PTGS2 remained significantly upregulated for at least 12 hours after withdrawal of cytokine stimulation. Finally, induction of this immune phenotype altered the transdifferentiation of hMSCs, one of their hallmark properties. CD40 may play an important role in the immunomodulatory effects of hMSCs in ARDS and inflammation.