Myeloid-derived suppressor cells (MDSCs), characterized by the co-expression of CD11b and Gr1, are a heterogeneous population of immature myeloid cells that exhibit strong suppressive functions against T cell responses. In inflammatory conditions like IBD, there is an increase in MDSCs but this is not sufficient to improve intestinal inflammation in IBD. Herein, we investigated the expansion of MDSCs in TNBS-induced acute colitis and whether the adoptive transfer of in vitro generated MDSCs ameliorated intestinal inflammation. We found that CD11b+Gr1+ MDSCs were significantly increased in experimental colitis. Further, this increase correlated to some extent with the severity of the disease. As per our protocol, MDSCs were generated from bone marrow cells co-cultured with hepatic stellate cells (HSCs), an essential cell type to obtain functional MDSCs in vitro. Adoptive transfer of HSC-induced MDSCs improved body weight loss and significantly downregulated inflammatory cytokines TNF, IFN-γ, and IL-17 in colonic tissue. Our results indicate MDSCs are immunoregulatory players in intestinal inflammation and that the adoptive transfer of in vitro generated MDSCs may provide a novel therapeutic approach for inflammatory bowel disease.