In the cancer stem cell model a cell hierarchy has been suggested as an explanation for intratumoral heterogeneity and tumor formation is thought to be driven by this tumor cell subpopulation. The identification of cancer stem cells in osteosarcoma (OS) and the biological processes dysregulated in this cell subpopulation, also known as tumor-initiating cells (TICs), may provide new therapeutic targets. The goal of this study, therefore, was to identify and characterize the gene expression profiles of TICs isolated from human OS cell lines. We analyzed the self-renewal capacity of OS cell lines and primary OS tumors based upon their ability to form sphere-like structures (sarcospheres) under serum-starving conditions. TICs were identify from OS cell lines using the long-term label retention dye PKH26. OS TICs and the bulk of tumor cells were isolated and used to assess their ability to initiate tumors in NOD/SCID mice. Gene expression profiles of OS TICs were obtained from fresh orthotopic tumor samples. We observed that increased sarcosphere efficiency correlated with an enhanced tumorigenic potential in OS. PKH26Hi cells were shown to constitute OS TICs based upon their capacity to form more sarcospheres, as well as to generate both primary bone tumors and lung metastases efficiently in NOD/SCID mice. Genomic profiling of OS TICs revealed that both bone development and cell migration processes were dysregulated in this tumor cell subpopulation. PKH26 labeling represents a valuable tool to identify OS TICs and gene expression analysis of this tumor cell compartment may identify potential therapeutic targets.