Cancer stem cell (CSC) biology and the epithelial-to-mesenchymal transition (EMT) are thought to be mechanistically linked and may be key components of cancer development and progression. However, stimuli that induce EMT and CSC-like features (‘stemness’) are poorly defined. We and others have shown that the inflammatory cytokine oncostatin-M (OSM) mediates phenotypic changes in breast cancer that are consistent with EMT and dedifferentiation, including enhanced migration and loss of hormone receptors. In this study, we have expanded on these prior observations to determine whether OSM is a cell-extrinsic driver of EMT and/or stemness. OSM stimulation of the luminal breast cancer cell lines MCF7 and T47D induced EMT features including loss of membranous E-cadherin and induction of snail and slug expression. OSM treatment markedly enhanced the formation of mammospheres (up to 20-fold, P< 0.001), which displayed high expression of the pluripotency factor SOX2. The proportion of cells with a CD44 high CD24−/low phenotype was similarly increased by OSM (P< 0.001). OSM-induced mammosphere formation and CD44 high CD24−/low induction was dependent on PI3K signalling. In silico analysis of human breast tumours (from a publicly available data set, n= 322) confirmed that co-expression of a PI3K transcriptional signature, but not MAPK or STAT3 signatures, was necessary to detect an association between OSMR and poor prognosis. Assessment of a second in silico data set (n= 241 breast tumours) confirmed a significant relationship between OSMR, markers of EMT and CSCs, and chemotherapy resistance. Direct analysis of mRNA expression by RT–PCR in a third cohort (n= 72 breast tumours) demonstrated that high expression of OSM is associated positively with indicators of EMT (SNAI1, P< 0.001) and stemness (SOX2, P< 0.05). Our data suggest for the first time that OSM may promote a clinically relevant EMT/CSC-like phenotype in human breast cancer via a PI3K-dependent mechanism.