MRI plays an expanding role in stem cell therapies. The non-invasive nature and high spatial resolution of MR imaging make MR imaging a powerful tool to investigate biologic processes at the molecular and cellular level in vivo longitudinally. Quantitative detection of stem cells after transplantation may allow assessment of stem cell localization and migration, and monitoring of the therapeutic effectiveness of stem cell therapy. In this study, we present a technique for MR quantification of magnetically labeled mouse embryonic stem cells distributed or injected in agarose gel phantoms. Apparent transverse relaxation rate enhancements (ΔR2*) were measured by gradient echo sequences. The linear relationship between ΔR2* and the concentration of USPIO-labeled mouse embryonic stem cells was observed and used for quantifying cell density and cell number after injection or transplantation. The MRI acquisition and analysis protocol were validated by good agreement between actual cell numbers and MRI-estimated cell numbers over a wide range of cell numbers. This MR technique for cell number and cell density quantification is applicable to future in vivo studies.