What makes stem cells special?

Stem cells are self-renewing and pluripotent, meaning that they can develop into any of the over 200 unique cell types in the body. Three transcription factors, Oct4, Sox2, and Nanog were previously identified as crucial for stem cell development. Oct4 binds Sox2 and together they regulate Nanog. Boyer and colleagues used chromatin immuno-precipitation (ChIP) to determine which genes these proteins bind (and presumably regulate). They found that they bind the promoters of many of the same genes and that many of these genes encode transcription factors that are important in development. Several genes encoding micro RNAs (miRNA) were also bound, which is particularly interesting since stem cells lacking miRNA processing cannot differentiate. Oct4 and Sox2 can activate or repress gene transcription. After correlating with expression profiles, the 3 factors bound 1303 active genes and 957 inactive genes. If the master switches and pathways are identified, it may be possible to convert any cell into a stem cell by activating the correct, hopefully few, genes.
Boyer et al Core transcriptional regulatory circuitry in human embryonic stem cells." Cell. 2005 Sep 23;122(6):947-56