There is now accumulating evidence showing that some tumors may arise from transformed stem cells. In this study we demonstrate that adult bone marrow- derived mesenchymal stem cells (MSCs) undergo neoplastic transformation induced by the human polyomavirus JCV, early protein, T-antigen, and are tumorigenic when transplanted into the flanks of Nude mice as compared to non-transformed MSCs. Histologically, the tumors are heterogeneous with mesenchymal and neural crest characteristics as evidenced by expression of the neural crest markers p75, SOX-10, and S-100, with populations of tumor cells exhibiting characteristics of primitive neuroectodermal cells. In addition, a subset of T-antigen positive tumor cells exhibit a high proliferation index as detected by Ki-67 labeling, and co-express CD133, a marker which is expressed on cancer stem cells. These results show that tumors with neuroectodermal characteristics may arise from transformation of MSCs, a globally accessible adult stem cell with multipotent differentiation capacity. In light of earlier reports on the association of JCV with a broad variety of human tumors, our data suggests that T-antigen transformation of adult stem cells with a multipotent capacity can serve as a possible common origin for some of these cancers, and offers a novel model for oncogenesis.