Fueled by the promise of regenerative medicine, currently there is unprecedented interest in stem cells. Furthermore, there have been revolutionary, but somewhat controversial, advances in our understanding of stem cell biology. Stem cells likely play key roles in the repair of diverse lung injuries. However, due to very low rates of cellular proliferation in vivo in the normal steady state, cellular and architectural complexity of the respiratory tract, and the lack of an intensive research effort, lung stem cells remain poorly understood compared to those in other major organ systems. In the present review, we concisely explore the conceptual framework of stem cell biology and recent advances pertinent to the lungs. We illustrate lung diseases in which manipulation of stem cells may be physiologically significant and highlight the challenges facing stem cell-related therapy in the lung.