The cancer stem cell theory elucidates not only the issue of tumour initiation and development, tumour's ability to metastasise and reoccur, but also the ineffectiveness of conventional cancer therapy. This review examines stem cell properties, such as self-renewal, heterogeneity, and resistance to apoptosis. The ?niche' hypothesis is presented, and mechanisms of division, differentiation, self-renewal and signalling pathway regulation are explained. Epigenetic alterations and mutations of genes responsible for signal transmission may promote the formation of cancer stem cells. We also present the history of development of the cancer stem cell theory and discuss the experiments that led to the discovery and confirmation of the existence of cancer stem cells. Potential clinical applications are also considered, including therapeutic models aimed at selective elimination of cancer stem cells or induction of their proper differentiation.