Stem cells have the unique potential to self-renew and to supply differentiated cells that replenish lost cells throughout an organism's lifetime. This unique property makes stem cells powerful therapeutic tools for future regenerative medicine. However, the molecular mechanisms of stem cell regulation are still poorly understood in many stem cell systems. Stem cell function has been shown recently to be controlled by concerted actions of extrinsic signals from its regulatory niche and intrinsic factors inside the stem cell. Stem cells in the Drosophila reproductive systems provide excellent models to understand the fundamental mechanisms underlying stem cell regulation, including the relationships between stem cells and their niches. Within the past few years, much progress in understanding stem cells in Drosophila has been made, and the knowledge gained from studying these stem cells greatly advances our understanding of stem cells in other systems, including humans. In this review, we summarize the recent progress and describe future challenges in understanding the molecular mechanisms controlling stem cell self-renewal, division, and differentiation in the Drosophila reproductive systems. Developmental Dynamics 232:775–790, 2005. © 2005 Wiley-Liss, Inc.