Asymmetric cell division is an important process to generate cell diversity and maintain tissue homeostasis. Recent evidence suggests that this process may also be crucial to prevent tumor formation. In the past 30 years, the embryo of the nematode Caenorhabditis elegans has proven to be a very powerful model to study the molecular and cellular basis of asymmetric cell division. Understanding this process in Caenorhabditis elegans may thus lead to a better understanding of stem cell function and tumorigenesis in humans. Developmental Dynamics 239:1378–1387, 2010. © 2010 Wiley-Liss, Inc.