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The myelodysplastic syndromes (MDS) represent a group of clonal disorders characterized by ineffective hematopoiesis, resulting in peripheral cytopenias and frequent transformation to acute myeloid leukemia (AML). We and others have demonstrated that MDS arises in, and is propagated by malignant stem cells (MDS-SCs), that arise due to the sequential acquisition of genetic and epigenetic alterations in normal hematopoietic stem cells (HSCs). This review focuses on recent advancements in the cellular and molecular characterization of MDS-