Cellular heterogeneity is an integral part of cancer development and progression. Progression can be associated with emergence of cells that exhibit high phenotypic plasticity (including "de-differentiation" to primitive developmental states), and aggressive behavioral properties (including high tumorigenic potentials). We observed that many biomarkers that are used to identify Cancer Stem Cells (CSC) can label cell subsets in an advanced clinical stage of lung cancer (malignant pleural effusions, or MPE). Thus, CSC-biomarkers may be useful for live sorting functionally distinct cell subsets from individual tumors, which may enable investigators to hone in on the molecular basis for functional heterogeneity. We demonstrate that the CD44(hi) (CD44-high) cancer cell subsets display higher clonal, colony forming potential than CD44(lo) cells (n=3) and are also tumorigenic (n=2/2) when transplanted in mouse xenograft model. The CD44(hi) subsets express different levels of embryonal (de-differentiation) markers or chromatin regulators. In archived lung cancer tissues, ALDH markers co-localize more with CD44 in squamous cell carcinoma (n=5/7) than Adeno Carcinoma (n=1/12). MPE cancer cells and a lung cancer cell line (NCI-H-2122) exhibit chromosomal abnormalities and 1p36 deletion (n=3/3). Since miR-34a maps to the 1p36 deletion site, low miR-34a expression levels were detected in these cells. The colony forming efficiency of CD44(hi) cells, characteristic property of CSC, can be inhibited by mir-34a replacement in these samples. In addition the highly tumorigenic CD44(hi) cells are enriched for cells in the G2 phase of cell cycle.