Human teratocarcinomas or mixed germ cell tumours are histologically composed of diverse tissues corresponding to somatic and extraembryonic (trophoblastic and yolk sac) like cells, as well as malignant stem cells. In typical teratocarcinomas these stem cells correspond to embryonal carcinoma cells, ie developmentally pluripotent cells equivalent to embryonic cells from the early stages of development. These cells have the capacity to differentiate and give rise to non-proliferating terminally differentiated tissue. Occasionally embryonal carcinoma cells can give rise to more differentiated stem cells which have the phenotype and the restricted developmental potential of choriocarcinoma and yolk sac carcinoma cells, or less commonly to somatic cell malignancies, indistinguishable from typical carcinomas, sarcomas, melanoma or lymphomas. Malignant transformation of benign somatic tissues in teratomas can also give rise to malignant stem cells, which all have a somatic cell phenotype. The biology and the clinical presentation as well as the response to chemotherapy of germ cell tumours depend on the nature of stem cells that form their proliferative compartment and account for the malignancy of these tumours.