The cancer stem cell hypothesis postulates that a single stem-like cancer cell is able to produce all cancer cell types found in a tumor. These cells are also thought to be the causative agents of relapse following therapy. In order to confirm the importance of cancer stem cells in tumor formation and patient prognosis, their role in prostate cancer must be comprehensively studied. This review describes current methods and markers for isolating and characterizing prostate cancer stem cells, including assays for self-renewal, multipotency and resistance to therapy. In particular the advantages and limitations of these approaches are analyzed. The review will also examine novel methods for studying the lineage of cancer stem cells in vivo using transgenic mouse models. These lineage tracing approaches have significant advantages and, if a number of challenges can be addressed, offer great potential for understanding the significance of cancer stem cells in human prostate cancer.