Human amniotic fluid has been used in prenatal diagnosis for more than 70 years. It has proven to be a safe, reliable, and simple screening tool for a wide variety of developmental and genetic diseases. However, there is now evidence that amniotic fluid may have more use than only as a diagnostic tool and may be the source of a powerful therapy for a multitude of congenital and adult disorders. A subset of cells found in amniotic fluid and placenta has been isolated and found to be capable of maintaining prolonged undifferentiated proliferation as well as able to differentiate into multiple tissue types encompassing the three germ layers. It is possible that in the near future, we will see the development of therapies using progenitor cells isolated from amniotic fluid and placenta for the treatment of newborns with congenital malformations as well as of adults, using cryopreserved amniotic fluid and placental stem cells. In this chapter, we describe a number of experiments that have isolated and characterized pluripotent progenitor cells from amniotic fluid and placenta. We also discuss various cell lines derived from amniotic fluid and placenta and future directions for this area of research.