Donor cell leukemia (DCL) is a rare complication of hematopoietic cell transplantation (HCT). Its incidence has been reported between 0.12% and 5%, although the majority of cases are anecdotal. The mechanisms of leukemogenesis in DCL may be distinct from other types of leukemia. Possible causes of DCL include oncogenic alteration or premature aging of transplanted donor cells in an immunosuppressed person. Although many studies have recently better characterized leukemic stem cells, it is important to also consider that both intrinsic cell factors and external signals from the hematopoietic microenvironment govern the developmental fate of hematopoietic stem cells (HSCs). Therefore, in cases of DCL, alteration of the microenvironment after HCT may increase the likelihood that some progeny of normal HSCs become leukemic. This complex intercommunication between cells, growth factors, and cytokines in the hematopoietic microenvironment are critical to balance HSC self-renewal, proliferation, and differentiation. However, this homeostasis is likely perturbed in the development of DCL, allowing unique insight into the stimuli that regulate normal and potentially abnormal hematopoietic development. In this article, we discuss the possible pathogenesis of DCL, its association with stem cells, and its likely dependence on a less-supportive stem cell niche.