Cancer-associated fibroblasts (CAFs) demonstrate the characteristics of myofibroblast differentiation by often expressing the ultrastructure of alpha-smooth muscle actin (αSMA). However, heterogeneity among cancer-associated fibroblasts (CAFs), with respect to αSMA expression, has been demonstrated in several clinical studies of oral cancer. Like normal stem cells, stem-like cancer cells (SLCCs) are also regulated extrinsically by its microenvironment; therefore, we postulated that the heterogeneous oral-CAFs would differently regulate oral-SLCCs. Using transcriptomics, we clearly demonstrated that the gene expression differences between oral tumor-derived CAFs were indeed the molecular basis of heterogeneity. This also grouped these CAFs in two distinct clusters, which were named as C1 and C2. Interestingly, the oral-CAFs belonging to C1 or C2 clusters showed low or high αSMA-score, respectively. Our data with tumor tissues and in vitro co-culture experiments interestingly demonstrated a negative correlation between αSMA-score and cell proliferation, whereas, the frequency of oral-SLCCs was significantly positively correlated with αSMA-score. The oral-CAF-subtype with lower score for αSMA (C1-type CAFs) was more supportive for cell proliferation but suppressive for the self-renewal growth of oral-SLCCs. Further, we found the determining role of BMP4 in C1-type CAFs-mediated suppression of self-renewal of oral-SLCCs. Overall, we have discovered an unexplored interaction between CAFs with lower-αSMA expression and SLCCs in oral tumors and provided the first evidence about the involvement of CAF-expressed BMP4 in regulation of self-renewal of oral-SLCCs.