Embryonic stem cells (ESCs) hold great therapeutic promise for the regeneration of functional cell types and clinical applications. However, tumorigenic potential of stem cells in a transplanted host remains a major obstacle. In this issue of the JCI, Cui and colleagues identified TCF7-mediated canonical WNT signaling as a critical determinant of both the tumorigenicity and therapeutic function of ESC-derived retinal progenitor cells (ESC-RPCs). Their findings suggested that addressing key extracellular signaling and related intrinsic factors will be essential for the successful use of ESC-derived progenitor transplantation.