Stem cell research has emerged as an innovative scientific tool in the field of science such as biology, drug discovery, regenerative medicine and toxicological studies which allow us to develop novel techniques for restoration and replacement of damaged tissue. Stem cells are unspecialized cells which show the capacity to develop various cell types in the body. These are derived from a variety of sources (embryos, umbilical cord, blood and placentas) and are classified on the basis of their sources, origin and development and plasticity of differentiation. These also aid to the mechanism of disease evolution and thereby assists in the development of safer and effective drugs. Stem cells are known to treat various diseases such as Alzheimer's, Parkinson's, cancer, Type I diabetes, cardiovascular, gastrointestinal, urogenital, ocular and neurodegenerative diseases. Though stem cell has proved its effectiveness for various chronic illnesses, the hurdles lie in the fact that, research involves the destruction of an embryo or foetus which therefore raises sharp ethical and political controversies. These issues need to be discussed along with scientific challenges to ensure that stem cell research is carried out in an ethical manner. This review article provides a new insight in stem cell research which offers great promises for the benefit of science and society.