Bronchopulmonary dysplasia (BPD) is a chronic lung disease of preterm infants, particularly being the most common complication among extremely preterm infants (those born with a gestational age of less than 32 weeks). Despite advances in perinatal treatment and care, modern clinical management still lacks therapies specifically designed to promote lung repair and growth. Mesenchymal stem cells (MSCs) are a type of stem cells with multi-differentiation potential, and recent advances have revealed their potential to repair damaged organs through stem/progenitor cell-mediated regeneration. However, clinical risks associated with MSCs have hindered their broader applications. Research indicates that in BPD animal models, MSC-derived extracellular vesicles (MSC-EVs) manage to promote pulmonary angiogenesis, facilitate alveolar development, reduce pulmonary arterial hypertension, and alleviate pulmonary inflammation by downregulating fibrotic factors, alleviating inflammatory responses, and promoting angiogenesis, anti-apoptosis, and resistance to oxidative stress. Therefore, they play critical roles in the repair of lung injuries associated with BPD. This article reviews the potential preclinical evidence and possible mechanisms of MSC-EV-associated therapy in the treatment of neonatal BPD, providing new therapeutic insights for its future clinical application in neonatal BPD.