Cancer cells have phenotypic features resembling embryonic stem cells and thus cancer is also defined as a 'disease of differentiation', 'stem cell disease' or 'oncogeny in blocked ontogeny'. The question whether cancer occurs due to dedifferentiation/reprogramming of somatic cells or arises from resident stem cells remains unanswered but has a strong tilt towards de-differentiation of somatic cells. Similarly 'plasticity' of adult stem cells into multiple lineages for regenerative medicine is also explained by de-differentiation/trans-differentiation. This concept got a strong support from the ability of somatic cells to get reprogrammed to pluripotent state in vitro. However, a sub-population of pluripotent stem cells possibly gives rise to induced pluripotent stem cells rather than reprogramming of somatic skin fibroblasts. Similarly, rather than de-differentiation of somatic cells, possibly a sub-population of pluripotent VSELs (that maintains lifelong homeostasis by serving as a backup pool of stem cells to give rise to tissue specific progenitors') gets transformed into cancer stem cells (CSCs) and also explain plasticity of adult stem cells. VSELs express pluripotent markers (OCT-4, NANOG, SOX-2, LIN-28), survive chemotherapy and undergo asymmetric cell divisions (self renew and give rise to progenitors with huge ability to proliferate and undergo clonal expansion). Their halted differentiation at various stages due to a compromised niche may explain heterogeneity noted in tumors. Ability of VSELs to get transformed into CSCs can also explain plasticity of adult stem calls and is discussed using pancreatic, hematopoietic and gonadal (ovarian, testicular) stem cells biology.