Multiple myeloma is the abnormal clonal expansion of post germinal B cells in the bone marrow. It was previously reported that clonogenic myeloma cells are CD138-. Human MM cell lines RPMI8226 and NCI H929 contained 2-5% of CD138- population. In this study, we showed that CD138- cells have increased ALDH1 activity, a hallmark of normal and neoplastic stem cells. CD138-ALDH+ cells were more clonogenic than CD138+ALDH- cells and only CD138- cells differentiated into CD138+ populations. In vivo tumor initiation and clonogenic potentials of the CD138- population was confirmed using NOG mice. We derived a gene expression signature from functionally validated and enriched CD138- clonogenic population from MM cell lines and validated these in patient samples. This data showed that CD138- cells had an enriched expression of genes that are expressed in normal and malignant stem cells. Differentially expressed genes included components of the polycomb repressor complex (PRC) and their targets. Inhibition of PRC by DZNep showed differential effect on CD138- and CD138+ populations. The 'stemness' signature derived from clonogenic CD138- cells overlap significantly with signatures of common progenitor cells, hematopoietic stem cells, and Leukemic stem cells and is associated with poorer survival in different clinical datasets.