Although CD138 expression is a hallmark of plasma cells and myeloma cells, reduced CD138 expression is occasionally found. However, the mechanisms underlying CD138 downregulation in myeloma cells remain unclear. Previous reports suggest that the bone marrow microenvironment may contribute to CD138 downregulation. Among various factors in the tumor microenvironment, hypoxia is associated with tumor progression, poor clinical outcomes, dedifferentiation and the formation of cancer stem cell niches in solid tumors. Since recent findings showed that progression of multiple myeloma (MM) delivers hypoxia within the bone marrow, we hypothesized that CD138 expression may be regulated by hypoxia. In the present study, we examined whether the expression of CD138 and transcription factors occurred in myeloma cells under hypoxic conditions. MM cell lines (KMS-12BM and RPMI 8226) were cultured under normoxic or hypoxic conditions for up to 30 days. Changes in the phenotype and the expression of surface antigens and transcription factors were analyzed using flow cytometry, RT-PCR and western blotting. All-trans retinoic acid (ATRA) was used to examine the phenotypic changes under hypoxic conditions. The expression levels of CD138, CS1 and plasma cell-specific transcription factors decreased under hypoxic conditions, while those of CD20, CXCR4 and B cell-specific transcription factors increased compared with those under normoxic conditions. Stem cell-specific transcription factors were upregulated under hypoxic conditions, while no difference was observed in ALDH activity. The reduced CD138 expression under hypoxic conditions recovered when cells were treated with ATRA, even under hypoxic conditions, along with decreases in the expression of stem cell-specific transcription factor. Interestingly, ATRA treatment sensitized MM cells to bortezomib under hypoxia. We propose that hypoxia induces immature and stem cell-like transcription phenotypes in myeloma cells. Taken together with our previous observation that decreased CD138 expression is correlated with disease progression, the present data suggest that a hypoxic microenvironment affects the phenotype of MM cells, which may correlate with disease progression.