A method inducing chimerism and allograft tolerance by co-infusion of stein/progenitor-like cells and donor cells, wherein the donor cells can be bone marrow cells. The method also comprises the conditioning comprising depletion of CD4+ and CD8+ T-cells and administration of low doses of anti-neoplastic drugs. The inventive method comprises an aspect wherein allograft tolerance is induced without systemically suppressing the immune system.
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