In mammals, Wnt/b-catenin signaling features prominently in stem cells and cancers, but how and for what purposes have been matters of much debate. In this review, we summarize our current knowledge of Wnt/b-catenin signaling and its downstream transcriptional regulators in normal and malignant stem cells. We centered this review largely on three types of stem cells-embryonic stem cells, hair follicle stem cells, and intestinal epithelial stem cells-in which the roles of Wnt/b-catenin have been extensively studied. Using these models, we unravel how many controversial issues surrounding Wnt signaling have been resolved by dissecting the diversity of its downstream circuitry and effectors, often leading to opposite outcomes of Wnt/b-catenin-mediated regulation and differences rooted in stage-and context-dependent effects.