Hypoxia is an important environmental change in many cancers. Hypoxic niches can be occupied by cancer stem/progenitor-like cells that are associated with tumor progression and resistance to radiotherapy and chemotherapy. However, it has not yet been fully elucidated how hypoxia influences the stem-like properties of prostate cancer cells. In this report, we investigated the effects of hypoxia on human prostate cancer cell lines, PC-3 and DU145. In comparison to normoxia (20% O2), 7% O2 induced higher expressions of HIF-1α and HIF-2α, which were associated with upregulation of Oct3/4 and Nanog; 1% O2 induced even greater levels of these factors. The upregulated NANOG mRNA expression in hypoxia was confirmed to be predominantly retrogene NANOGP8. Similar growth rates were observed for cells cultivated under hypoxic and normoxic conditions for 48 hours; however, the colony formation assay revealed that 48 hours of hypoxic pretreatment resulted in the formation of more colonies. Treatment with 1% O2 also extended the G0/G1 stage, resulting in more side population cells, and induced CD44 and ABCG2 expressions. Hypoxia also increased the number of cells positive for ABCG2 expression, which were predominantly found to be CD44bright cells. Correspondingly, the sorted CD44bright cells expressed higher levels of ABCG2, Oct3/4, and Nanog than CD44dim cells, and hypoxic pretreatment significantly increased the expressions of these factors. CD44bright cells under normoxia formed significantly more colonies and spheres compared with the CD44dim cells, and hypoxic pretreatment even increased this effect. Our data indicate that prostate cancer cells under hypoxia possess greater stem-like properties.