Embryonic stem cells sustain a microenvironment that facilitates a balance of self-renewal and differentiation. Aggressive cancer cells, expressing a multipotent, embryonic cell-like phenotype, engage in a dynamic reciprocity with a microenvironment that promotes plasticity and tumorigenicity. However, the cancer-associated milieu lacks the appropriate regulatory mechanisms to maintain a normal cellular phenotype. Previous work from our laboratory reported that aggressive melanoma and breast carcinoma express the embryonic morphogen Nodal, which is essential for human embryonic stem cell (hESC) pluripotency. Based on the aberrant expression of this embryonic plasticity gene by tumor cells, this current study tested whether these cells could respond to regulatory cues controlling the Nodal signaling pathway, which might be sequestered within the microenvironment of hESCs, resulting in the suppression of the tumorigenic phenotype. Specifically, we discovered that metastatic tumor cells do not express the inhibitor to Nodal, Lefty, allowing them to overexpress this embryonic morphogen in an unregulated manner. However, exposure of the tumor cells to a hESC microenvironment (containing Lefty) leads to a dramatic down-regulation in their Nodal expression concomitant with a reduction in clonogenicity and tumorigenesis accompanied by an increase in apoptosis. Furthermore, this ability to suppress the tumorigenic phenotype is directly associated with the secretion of Lefty, exclusive to hESCs, because it is not detected in other stem cell types, normal cell types, or trophoblasts. The tumor-suppressive effects of the hESC microenvironment, by neutralizing the expression of Nodal in aggressive tumor cells, provide previously unexplored therapeutic modalities for cancer treatment.