This review summarises the existing knowledge on the phenotype of the carcinoma in situ (CIS) cell. CIS is a common pre-invasive precursor of testicular germ cell tumours of adolescents and young adults. These tumours display a variety of histological forms. Classical seminoma proliferates along the germ cell lineage, whereas embryonal carcinoma retains embryonic features and readily differentiates into teratomas that resemble various somatic cell lineages. A thorough review of the gene expression in CIS cells in comparison to normal testicular germ cells and overt tumours supports the view that CIS is a common precursor for both tumour types. Impaired cell differentiation resulting in a partial retention of the embryonic features, associated with an increasing genomic instability may be responsible for a remarkable phenotypic heterogeneity of CIS cells. Depending on the degree of differentiation and pluripotency, CIS cells found in adult patients seem to be predestined for further malignant progression into one or the other of the two main types of overt tumours. A new concept of phenotypic continuity of differentiation of germ cells along germinal lineage with a gradual loss of embryonic features based on the analysis of gene expression in all types of germ cells during their ontogeny is presented in this review. The data point out that despite the phenotypic continuum of gene expression, there are two periods of rapid changes of gene expression: first at the transition from primordial germ cells to pre-spermatogonia, and later during the pubertal switch from the mitotic to meiotic cell division. The persistent expression of embryonic traits in CIS cells, and the high expression of the cell cycle regulators that are typical of mitotic germ cells support our long-standing hypothesis that CIS cells originate from primordial germ cells or gonocytes and not from germ cells in the adult testis.