The differentiation stage of tumors is a central aspect in the histopathological classification of solid malignancies. The differentiation stage is strongly associated with tumor behavior, and generally an immature tumor is more aggressive than the more differentiated counterpart. While this is common knowledge in surgical pathology, the contribution of differentiation-related gene expression and functions to tumor behavior is often overlooked in the experimental, tumor biological setting. The mechanisms by which tumor cell differentiation stages are perturbed or affected are poorly explored but have recently come into focus with the introduction.of the tumor stem cell concept. While developmental biologists view the differentiation as a unidirectional event, pathologists and tumor biologists have introduced the concept of dedifferentiation to explain phenotypic changes occurring in solid tumors. In this review we discuss the impact of the tumor cell differentiation stage as used in surgical pathology. We further discuss knowledge gained from exploring the molecular basis of the differentiation and dedifferentiation processes in neuroblastoma and breast cancer, two tumor forms where the tumor cell differentiation concept is used in the clinical diagnostic work and where the tumor stem cell theory has been applied.