Nonsense-mediated mRNA decay (NMD) is a highly conserved post-transcriptional regulatory mechanism of gene expression in eukaryotes. Originally, NMD was identified as an RNA surveillance machinery in degrading 'aberrant' mRNA species with premature termination codons. Recent studies indicate that NMD regulates the stability of natural gene transcripts that play significant roles in cell functions. Although components and action modes of the NMD machinery in degrading its RNA targets have been extensively studied with biochemical and structural approaches, the biological roles of NMD remain to be defined. Stem cells are rare cell populations, which play essential roles in tissue homeostasis and hold great promises in regenerative medicine. Stem cells self-renew to maintain the cellular identity and differentiate into somatic lineages with specialized functions to sustain tissue integrity. Transcriptional regulations and epigenetic modulations have been extensively implicated in stem cell biology. However, post-transcriptional regulatory mechanisms, such as NMD, in stem cell regulation are largely unknown. In this paper, we summarize the recent findings on biological roles of NMD factors in embryonic and tissue-specific stem cells. Furthermore, we discuss the possible mechanisms of NMD in regulating stem cell fates.