Stem cells can both self-renew and differentiate into various cell types under certain conditions, which makes them a good model for development and disease studies. Recently, chemical approaches have been widely applied in stem cell biology by promoting stem cell self-renewal, proliferation, differentiation and somatic cell reprogramming using specific small molecules. Conversely, stem cells and their derivatives also provide an efficient and robust platform for small molecule and drug screening. Here, we review the current research and applications of small molecules that modulate stem cell self-renewal and differentiation and improve reprogramming, as well as the applications that use stem cells as a tool for small molecule screening. Moreover, we introduce the recent advance in haploid embryonic stem cells research. Haploid embryonic stem cells maintain haploidy and stable growth over extensive passages, possess the ability to differentiate into all three germ layers in vitro and in vivo, and contribute to the germlines of chimeras when injected into blastocysts. Androgenetic haploid stem cells can also be used in place of sperm to produce fertile progeny after intracytoplasmic injection into mature oocytes. Such characteristics demonstrate that haploid stem cells are a new approach for genetic studies at both the cellular and animal levels and that they are a valuable platform for future small molecule screening.