Stem cells in human interfollicular epidermis are still difficult to identify, mainly because of a lack of definitive markers and the inability to label human beings for label-retaining cells (LRCs). Here, we report that LRCs could be identified and localized in organotypic cultures (OTCs) made with human cells. Labeling cultures for 2 weeks with iododeoxyuridine (IdU) and then chasing for 6-10 weeks left <1% of basal cells retaining IdU label. Whole mounts demonstrated that LRCs were individually dispersed in the epidermal basal layer. Some LRCs, but not all, colocalized with cells expressing melanoma chondroitin sulfate proteoglycan, a putative stem cell marker. Although we found LRCs in both collagen- and scaffold-based OTCs, only the scaffold-OTCs supported long-term survival and regeneration. LRCs ' short survival in collagen-OTCs was not due to loss of appropriate growth factors from fibroblasts. Instead, it was due to expression of metalloproteinases, especially matrix metalloproteinase (MMP)-2 and MMP-14, which caused collagen fragmentation, matrix degradation, and dislocation of specific basement membrane components bound to epidermal integrins. Blocking MMP activation not only abrogated MMP-dependent matrix degradation but also increased longevity of the epidermis and the LRCs in these cultures. Such findings indicate that the stem cell niche, the microenvironment surrounding and influencing the stem cell, is essential for stem cell survival and function, including long-term tissue regeneration. Disclosure of potential conflicts of interest is found at the end of this article.