Sacrococcygeal teratomas (SCTs) are benign tumours of the newborn with absolute indication for surgery directly after birth. We recently described the presence of stem cells positive for the stem cell markers nanog and Oct4 in SCTs. Here we report the isolation of three stem cell lines from three different SCTs. Cells were propagated in mesenchymal or in embryonic stem cell medium. Non-clonal homogeneous stem cell lines were obtained after two to three passages and characterized in vitro by immunocytochemistry, RT-PCR, western blot, FACS analysis, and metaphase spreads. The differentiation potential was tested in vitro and in vivo. The isolated cell lines, which we refer to as human sacrococcygeal teratoma stem cells (hSctSCs), express nanog, Oct4 and stella, and are negative for malignancy markers alpha-fetoprotein and carcinoembryonic antigen. They can be induced in vitro to express neuronal, osteogenic, and chondrogenic traits. After grafting in vivo, spontaneous integration into the neural crest of the chick embryo and teratoma formation in the nude mouse were obtained. Our results indicate that SCTs are derived from remnants of the epiblast-derived primitive streak, which in the human embryo normally regresses but forms teratomas in children affected with SCT. The hSctSCs therefore may be comparable to mouse epiblast-derived stem cells (EpiSCs) and share characteristic features with human embryonic stem (hES) cells. Thus, SCT tissue obtained after surgery appears to be a novel source for the generation of human stem cells without the ethical implications associated with hES cells.