The key hallmark of stem cells is their ability to self-renew while keeping a differentiation potential. Intrinsic and extrinsic cell factors may contribute to a decline in these stem cell properties, and this is of the most importance when culturing them. One of these factors is oxygen concentration, which has been closely linked to the maintenance of stemness. The widely used environmental 21% O2 concentration represents a hyperoxic non-physiological condition, which can impair stem cell behaviour by many mechanisms. The goal of this review is to understand these mechanisms underlying the oxygen signalling pathways and their negatively-associated consequences. This may provide a rationale for culturing stem cells under physiological oxygen concentration for stem cell therapy success, in the field of tissue engineering and regenerative medicine.