Prostate cancer is an epithelial malignancy and stem cells are a major focus of current research efforts. This is a warranted approach, since the processes of self-renewal and differentiation underpin the fundamental biology of malignancy and cancer recurrence due to therapeutic resistance. In this chapter, we review the regulation of stem cells through reciprocal interaction with the surrounding microenvironment. In both normal tissues and in prostate cancer, stem cells are controlled by both intrinsic and extrinsic mechanisms, the latter involving stromal directed stem cell differentiation. Herein, we discuss the current experimental models to study stromal-stem cell interaction and present the current knowledge on how the two cellular compartments should be considered in unison to design more effective therapies for clinical management of prostate cancer.