The lack of appropriate candidates of cell sources for cell transplantation has hampered efforts to develop therapies for tendon injuries, such as tendon rupture, tendonitis, and tendinopathy. Tendon-derived stem cells (TDSCs) are a type of stem cells which may be used in the treatment of tendon injuries. In this study, TDSCs were isolated from 5-mo-old Luxi Yellow fetal bovine and cultured in vitro and further analyzed for their biological characteristics using immunofluorescence and reverse transcription-polymerase chain reaction (RT-PCR) assays. It was found that primary TDSCs could be expanded for 42 passages in vitro maintaining proliferation. The expressions of stem cell marker nucleostemin and tenocyte-related markers, such as collagen I, collagen II, collagen III, and tenascin-C, were observed on different passage cells by immunofluorescence. The results from RT-PCR show that TDSCs were positive for collagen type I, CD44, tenascin-C, and collagen type III but negative for collagen type II. Meanwhile, TDSC passage 4 was successfully induced to differentiate into osteoblasts, adipocytes, and chondrocytes. Our results indicate that the fetal bovine TDSCs not only had strong self-renewal capacity but also possess the potential for multi-lineage differentiation. This study provides theoretical basis and experimental foundation for potential therapeutic application of the fetal bovine TDSCs in the treatment of tendon injuries.