Aldehyde dehydrogenase 1 A1 (ALDH1A1) has recently been suggested as a marker for cancer stem or stem-like cancer cells of some human malignancies. The purpose of this study was to investigate the stem cell-related function and clinical significance of the ALDH1A1 in bladder urothelial cell carcinoma. Aldefluor assay was used to isolate ALDH1A1+ cells from bladder cancer cells. Stem cell characteristics of the ALDH1A1+ cells were then investigated by in vitro and in vivo approaches. Immunohistochemistry was done for evaluating ALDH1A1 expression on 22 normal bladder tissues and 216 bladder tumor specimens of different stage and grade. The ALDH1A1+ cancer cells displayed higher in vitro tumorigenicity compared with isogenic ALDH1A1- cells. The ALDH1A1+ cancer cells could generate xenograft tumors that resembled the histopathologic characteristics and heterogeneity of the parental cells. High ALDH1A1 expression was found in 26% (56 of 216) of human bladder tumor specimens and significantly related to advanced pathologic stage, high histologic grade, recurrence and progression, and metastasis of bladder urothelial cell carcinomas (all P < 0.05). Furthermore, ALDH1A1 expression was inversely associated with cancer-specific and overall survivals of the patients (P = 0.027 and 0.030, respectively). Therefore, ALDH1A1+ cell population could be enriched in tumor-initiating cells. ALDH1A1 may serve as a useful marker for monitoring the progression of bladder tumor and identifying bladder cancer patients with poor prognosis who might benefit from adjuvant and effective treatments.