Stem cells exhibit a number of characteristic features, including the capacity for self-renewal and differentiation into multiple cell types, stress resistance, and drug efflux activity. These specific biological characteristics are supported by signals from the surrounding niche and the stemcell-specific transcription factor set, including hypoxia and the machinery that senses low oxygen levels. These properties are essential for normal stem cells, and when defective may induce cellular senescence and tumorigenesis. In contrast, cancer stem cells in tumor tissue utilize these biological characters driven by stemcell-specific molecular mechanisms and acquire indefinite selfrenewal capacity, drug resistance, and metastatic ability. A fuller understanding of the differences between normal and malignant stem cells in the biological and molecular context is, therefore, necessary to the development of therapies against cancer stem cells. In this review, we discuss the effect of hypoxic microenvironment on normal and malignant stem cells and describe their molecular machinery with an emphasis on hematopoietic stem cells and their malignant counterparts, leukemic stem cells.