Recent improvements in cell purification and transplantation techniques have contributed to the identification of cell populations known as tumor-initiating cells (TIC). This discovery has led to the ‘cancer stem cell hierarchy’ concept, which holds that tumors are organized as a hierarchy of malignant tissues sustained by such TIC. However, this concept remains controversial. In this review, we examine recent advances in cancer stem cell research that have been generated from studies of Philadelphia (Ph) chromosome-positive leukemia. The abnormal Ph chromosome, which arises from a translocation creating the BCR-ABL1 fusion gene, is most commonly associated with chronic myelogenous leukemia (CML) and precursor B cell acute lymphoblastic leukemia (B-ALL). Examination of the pathophysiology of these diseases has provided interesting insights into not only the hierarchy of leukemia stem cells but also their clonal evolution. Both shared and unique regulatory mechanisms affecting normal and CML stem cell behavior have been identified. On the other hand, genetic diversity in specific clones of Ph+ B-ALL that drive clonal evolution has recently come to light. Our expanding knowledge of the biology of TIC contributes to the progress of cancer research, and may open the door to new concepts in cancer therapy.