Induced pluripotent stem (iPS) cells have attracted a great deal attention as a new pluripotent stem cell type that can be generated from somatic cells, such as fibroblasts, by introducing the transcription factors Oct3/4, Sox2, Klf4, and c-Myc. The mechanism of generation, however, is not fully understood. Two mechanistic theories have been proposed; the stochastic model purports that every cell type has the potential to be reprogrammed to become an iPS cell and the elite model proposes that iPS cell generation occurs only from a subset of cells. Some reports have provided theoretical support for the stochastic model, but a recent publication demonstrated findings that support the elite model, and thus the mechanism of iPS cell generation remains under debate. To enhance our understanding of iPS cells, it is necessary to clarify the properties of the original cell source, i.e., the components of the original populations and the potential of each population to become iPS cells. In this review, we discuss the two theories and their implications in iPS cell research.