Cancer stem cells, also known as cancer initiating cells (CICs), are considered to be responsible for tumor growth and chemoresistance. Different hypotheses have been proposed to explain the origin of CICs, including mutations in adult stem/progenitor cells or the acquisition of stem-like characteristics in differentiated cells; however, studies have yielded conflicting identification for CICs and have little information for the origin to generate CICs. Part of the difficulty in identifying CICs may stem from the fact that the CICs studied have been largely derived from cancer cell lines or well-developed tumors. In previous studies, we have reported the enrichment of mouse pulmonary stem/progenitor cells (mPSCs) by using serum-free primary selection culture followed by FACS isolation using the coxsackievirus/adenovirus receptor (CAR) as the positive selection marker. Here, we demonstrated that overexpression of the pluripotent transcription factor Oct-4 is sufficient to induce CAR+/mPSCs transformation, which we name CAR+/mPSCsOct-4_hi. These transformed cells possess cancer initiating and chemoresistance potential, as well as exhibiting remarkable expression of certain proangiogenic factors, including angiopoietins (ANGs) and VEGF, and enhanced angiogenic potential. Moreover, CAR+/mPSCsOct-4_hi actively participated in tumor blood vessel formation and triggered a novel angiogenic mechanism, the angiopoietins/Tie2 signaling pathway. These study provide critical evidence supporting the possible origin to generate CICs, and help elucidate the pathways responsible for CICs-mediated blood vessel formation.