Somatic cells can be reprogrammed into a pluripotent ES-cell-like state (termed induced pluripotent stem cells, iPS) by transcription factors, which have enormous therapeutic potential for regenerative medicine. We have investigated whether iPS can directly differentiate into corneal epithelium-like cells. Mouse iPS cells were co-cultured with corneal limbal stroma. RT-PCR, immunohistochemistry and scanning electron microscopy analysis were used to detect differentiated iPS. Undifferentiated iPS cells expressed ES cells related genes. Co-culture with corneal limbal stroma, in the presence of additional factors bFGF, EGF and NGF, activated keratin expression 12 (K12, a marker of corneal epithelial cells) and downregulated Nanog. These data suggest that mouse iPS cells can differentiate into corneal epithelial-like cells by replication of a corneal epithelial stem cell niche.