A common feature among pre-malignant lesions is the induction of hypoxia through increased cell propagation and reduced access to blood flow. Hypoxia in breast cancer has been associated with poor patient prognosis, resistance to chemotherapy and increased metastasis. Although hypoxia has been correlated with factors associated with the latter stages of cancer progression, it is not well documented how hypoxia influences cells in the earliest stages of transformation. Using the immortalized MCF-10A breast epithelial cell line, we used hypoxic culture conditions to mimic reduced O2 levels found within early pre-malignant lesions and assessed various cellular parameters. In this non-transformed mammary cell line, O2 deprivation led to some changes not immediately associated with cancer progression, such as decreased proliferation, cell cycle arrest and increased apoptosis. In contrast, hypoxia did induce other changes more consistent with an increased metastatic potential. A rise in the CD44+CD24-/low-labeled cell sub-population along with increased colony forming capability indicated an expanded stem cell population. Hypoxia also induced cellular and molecular changes consistent with an epithelial-to-mesenchymal transition (EMT). Furthermore, these cells now exhibited increased migratory and invasive abilities. These results underscore the contribution of the hypoxic tumour microenvironment in cancer progression and dissemination.