In the skin, multipotent keratinocyte stem cells (KSC) are localised in the hair follicle bulge region. Although, KSC can be cultivated and grown in two-dimensional (2D) culture they rapidly lose stem cell markers when isolated from their niche. Currently, there is no KSC culture method available which recapitulates an environment similar to the KSC niche in the hair follicle. Here we describe the successful establishment of an in vitro 3D stem cell culture model developed from clonally growing keratinocyte lines derived from neonatal mice using culture conditions previously established for human keratinocytes. After 20 passages, keratinocyte lines showed a stable ratio of holoclones (stem cells), meroclones (stem and precursor cells) and paraclones (differentiating cells), with approximately 29% holoclones, 54% meroclones and 17% paraclones, and were thus termed keratinocyte stem and precursor cell (KSPC) cultures. In high calcium medium, KSPC cultures grown at the air-liquid interphase differentiated and formed epidermal equivalents. Notably, and in contrast to primary keratinocytes, keratinocytes from KSPC cultures were able to aggregate and form spherical clusters in hanging drops, a characteristic hallmark shared with other stem cell types. Similar to the in vivo situation in the hair follicle bulge, KSPC aggregates also showed low proliferation, down-regulation of keratin 6, absence of keratin 1, and expression of the KSC markers keratin 15, Sox9, NFATc1 and Zfp145. KSPC aggregates therefore provide an optimal in vitro 3D environment for the further characterisation and study of normal and genetically modified KSPC.