Cytokine-induced expansion of hematopoietic stem and progenitor cells (HSPCs) is not fully understood. In the present study, we show that whereas steady-state hematopoiesis is normal in basic fibroblast growth factor (FGF-2)–knockout mice, parathyroid hormone stimulation and myeloablative treatments failed to induce normal HSPC proliferation and recovery. In vivo FGF-2 treatment expanded stromal cells, including perivascular Nestin⁺ supportive stromal cells, which may facilitate HSPC expansion by increasing SCF and reducing CXCL12 via mir-31 up-regulation. FGF-2 predominantly expanded a heterogeneous population of undifferentiated HSPCs, preserving and increasing durable short- and long-term repopulation potential. Mechanistically, these effects were mediated by c-Kit receptor activation, STAT5 phosphorylation, and reduction of reactive oxygen species levels. Mice harboring defective c-Kit signaling exhibited abrogated HSPC expansion in response to FGF-2 treatment, which was accompanied by elevated reactive oxygen species levels. The results of the present study reveal a novel mechanism underlying FGF-2–mediated in vivo expansion of both HSPCs and their supportive stromal cells, which may be used to improve stem cell engraftment after clinical transplantation.