This chapter focuses on amniotic fluid-derived stem cells (AFSCs) isolated from the amniotic fluid and placental membranes, discussing their properties and potential clinical applications. The highly multipotent differentiation potential of AFSCs opens the possibility of the cell type being utilized to treat a wide range of diseases through the generation of replacement cells in the laboratory. The ability to use AFSCs to generate large numbers of osteocytes, myocytes, adipocytes, endothelial cells, hepatocytes, chondrocytes, and neurons provides a valuable tool for the development of novel cell therapies. In pre-clinical studies, AFSCs have shown efficacy in the treatment of bone defects, heart disease, kidney disease, neural degeneration, lung disease, and blood disorders. Future applications of AFSCs include the treatment of diabetes, the generation of a living-skin equivalent, for muscle regeneration, as a novel drug delivery system, as well as anti-inflammatory applications for graft vs. host disease.