Stem cells are undifferentiated precursor cells with the capacity for proliferation or terminal differentiation. Progression down the differentiation cascade results in a loss of proliferative potential in exchange for the differentiated phenotype. This balance is tightly regulated in the physiologic state. Recent studies, however, have demonstrated that during tumorigenesis, disruptions preventing terminal differentiation allow cancer cells to maintain a proliferative, precursor cell phenotype. Current therapies (i.e., chemotherapy and radiation therapy) target the actively proliferating cells in tumor masses, which in many cases inevitably induce therapy-resistant cancer cells. It is conceivable that promising therapy regimens can be developed by treating human cancers by inducing terminal differentiation, thereby restoring the interrupted pathway and shifting the balance from proliferation to differentiation. For example, osteosarcoma (OS) is a primary bone cancer caused by differentiation defects in mesenchymal stem cells (MSCs) for which several differentiation therapies have shown great promise. In this review, we discuss the various differentiation therapies in the treatment of human sarcomas with a focus on OS. Such therapies hold great promise as they not only inhibit tumorigenesis, but also avoid the adverse effects associated with conventional chemotherapy regimens. Furthermore, it is conceivable that a combination of conventional therapies with differentiation therapy should significantly improve anticancer efficacy and reduce drug-resistance in the clinical management of human cancers, including sarcomas.