One of the greatest challenges in the treatment of inner-ear disorders is to find a cure for the hearing loss that is caused by the loss of cochlear hair cells or spiral ganglion neurons. The recent discovery of stem cells in the adult inner ear that are capable of differentiating into hair cells, as well as the finding that embryonic stem cells can be converted into hair cells, raise hope for the future development of stem-cell-based treatment regimens. Here, we propose different approaches for using stem cells to regenerate the damaged inner ear and we describe the potential obstacles that translational approaches must overcome for the development of stem-cell-based cell-replacement therapies for the damaged inner ear.