Human pluripotent stem cells (PSCs) are a leading candidate for cell-based therapies because of their capacity for unlimited self renewal and pluripotent differentiation. These advances have recently culminated in the first-in-human PSC clinical trials by Geron, Advanced Cell Technology and the Kobe Center for Developmental Biology for the treatment of spinal cord injury and macular degeneration. Despite their therapeutic promise, a crucial hurdle for the clinical implementation of human PSCs is their potential to form tumors in vivo. In this Perspective, we present an overview of the mechanisms underlying the tumorigenic risk of human PSC–based therapies and discuss current advances in addressing these challenges.