Mesenchymal cells are mesoderm-derived stromal cells that are best known for providing structural support to organs, synthesizing and remodeling the extracellular matrix (ECM) and regulating development, homeostasis and repair of tissues. Recent detailed mechanistic insights into the biology of fibroblastic mesenchymal cells have revealed they are also significantly involved in immune regulation, stem cell maintenance and blood vessel function. It is now becoming evident that these functions, when defective, drive the development of complex diseases, such as various immunopathologies, chronic inflammatory disease, tissue fibrosis and cancer. Here, we provide a concise overview of the contextual contribution of fibroblastic mesenchymal cells in physiology and disease and bring into focus emerging evidence for both their heterogeneity at the single-cell level and their tissue-specific, spatiotemporal functional diversity.