How old is your home? Can you post a photo of the stone? In what area of the country do you reside? Are nearby homes of the same age and are their basements finished?

I ask, because one of our sons has an 1880 vintage home in northern Illinois. The foundation is field stone. Because basements of that era were really cellars, not basements as we now know, they were expected to weap (his even has the original cistern below the house). Even with new gutters directing water away from the house, there is still some infiltration following heavy snow melt or rain - considered normal. It functional for furnace, water heater and washer/dryer but not suited to finishing, so he has been advised.

If it's a true rubble stone foundation, most authorities say it should only be insulated from the exterior and not finished from the inside in a way that would trap moisture from water in either a liquid or airborne state.

And even insulating from the exterior can be a problem as some of these foundations will collapse as you excavate, as the backfill material was designed to hold it up and filter water slowly to runoffs lower down. And even if it wasn't, it may have deteriorated so much over the years as to be incapable of support.

I'll definitely get some pics up soon, fnmroberts, thanks.

Well, none of this sounds very promising. It doesn't have to be beautiful or even considered an "upgrade" for resell purposes. We really just would like to use it as an added space for the kids to "hang out" and for a treadmill and weight bench.

Here's a thought. Build a soffit wall at the ceiling but a few inches from the foundation. Make some heavy drapes and suspend them from behind the soffit, hanging to near the floor. This won't warm the space but will disquise the foundation while not sealing it.

Only thing I think of for the floor is some remnant carpet just used as area rugs which can inexpensively be replaced if ever damaged. Good luck.

I had something similar in my tiny basement when we lived in Boston. All we dig was paint on that white basement moisture prevention paint (I forget what it is called). It stopped any water that may have come in and helped brighten the place up a bit.

We have the same sort of basement, although ours is dry. Our home was built in 1900, in Kenora, Ontario.

Our basement was plaster and lathe at one time. They drove wedges of wood in between the rocks and cut them off plumb. To the end of the wedges they attached vertical slabs of wood, then tied it all together with lathe. We are trying to decide what to do with our basement as well. I have considered running a 2x4 along the floor parallel with the wall, with another nailed to the joists above, with studs running vertically between them, an inch or less from the rock wall. My wife loves the stone as it is, so it might be a while before I do anything. We have 9 foot ceilings in the basement.