Stem cells divide by mitosis to make new cells. Some of these new cells then differentiate. This lets stem cells supply the range of cell types an organism needs for development, growth and repair.
In an embryo, stem cells divide and differentiate to form all the different cell types, tissues and organs of the developing animal. In an adult animal, stem cells stay in some tissues. Their function is to replace cells that are lost or damaged. Bone marrow stem cells, for example, keep producing new blood cells, and stem cells in the skin help to heal a cut.
In plants, the meristems contain stem cells that divide and differentiate throughout the life of the plant. This produces new cells for growth, so roots and shoots lengthen, and it produces the different cell types of the plant such as xylem, phloem and root hair cells.