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In vertebrates, perception of sound, motion, and balance is mediated through mechanosensory hair cells located within the inner ear. In mammals, hair cells are only generated during a short period of embryonic development. As a result, loss of hair cells as a consequence of injury, disease, or genetic mutation, leads to permanent sensory deficits. At present, cochlear implantation is the only option for profound hearing loss. However, outcomes are still variable and even the best implant cannot provide the acuity of a biological ear. The recent emergence of stem cell technology has the potential to open new approaches for hair cell regeneration. The goal of this review is to summarize the current state of inner ear stem cell research from a viewpoint of its clinical application for inner ear disorders to illustrate how complementary studies have the potential to promote and refine stem cell therapies for inner ear diseases. The review initially discusses our current understanding of the genetic pathways that regulate hair cell formation from inner ear progenitors during normal development. Subsequent sections discuss the possible use of endogenous inner ear stem cells to induce repair as well as the initial studies aimed at transplanting stem cells into the ear.