Multiple aldehyde dehydrogenase genes have been identified in many tissues. Aldehyde dehydrogenase class 1A1 (ALDH1A1) has been identified as highly expressed in embryonal tissue as well as in adult stem cells isolated from bone marrow, brain, breast and possibly other tissues. The recent interest in the idea of cancer stem cells (CSC) has resulted in renewed and vigorous interest in aldehyde dehydrogenase activity as a marker for those stem cells as well. It has been known that ALDH activity, which may reflect other ALDH isozymes in addition to ALDH1A1, is important for multiple biological activities including drug resistance, cell differentiation, and oxidative stress response. Purification of viable cells with high ALDH activity has become relatively easy with the availability of flow cytometry based assay. In this review, we examine the data available in regarding the importance of ALDH activity in normal and malignant stem cell functions, and the potential diagnostic and therapeutic implications. We review the available tools that can impact ALDH activity and may have the potential to be used therapeutically, specifically targeting the CSC. We raise questions that need to be investigated before a reasonable therapeutic strategy can be devised that will effectively inhibit ALDH activity.