Respiratory and pulmonary diseases are among the leading causes of death globally. Despite tremendous advancements, there are no effective pharmacological therapies capable of curing diseases such as COPD (chronic obstructive pulmonary disease), ARDS (acute respiratory distress syndrome), and COVID-19. Novel and innovative therapies such as advanced therapy medicinal products (ATMPs) are still in early development. However, they have exhibited significant potential preclinically and clinically. There are several longitudinal studies published, primarily focusing on the use of cell therapies for respiratory diseases due to their anti-inflammatory and reparative properties, thereby hinting that they have the capability of reducing mortality and improving the quality of life for patients. The primary objective of this paper is to set out a state of the art review on the use of aerosolized MSCs and their potential to treat these incurable diseases. This review will examine selected respiratory and pulmonary diseases, present an overview of the therapeutic potential of cell therapy and finally provide insight into potential routes of administration, with a focus on aerosol-mediated ATMP delivery.