Mesenchymal stem cell (MSC)-mediated tissue regeneration offers opportunities to regenerate a bio-root and its associated periodontal tissues to restore tooth loss. Previously, we proved that the apical end of developing root was acting as a promising candidate cell source for root/periodontal tissue (R/PT) regeneration. In the present study, we investigated the properties of periapical follicle stem cells (PAFSCs) isolated from the apical end of developing root of human third molars at the root-developing stage and evaluated the potential application of these cells for cementum/periodontal ligament (PDL) regeneration and bio-root engineering. Putative PAFSCs were isolated and subcultured until 20th passage. Cell characteristics of PAFSCs at early or late passage were evaluated and compared with periodontal ligament stem cells (PDLSCs) via a series of histological, cellular, and molecular analyses. PAFSCs at early passage presented crucial stem cell properties and showed a higher proliferation rate than PDLSCs in vitro. Meanwhile, PAFSCs also showed the tissue-regenerative capacity to produce a typical cementum/PDL-like complex in vivo. During long-term passage, both cell populations changed in morphology and gradually lost their stem cell properties. The alkaline phosphatase (ALP) activity and expression of mineralization-related genes markedly declined as more passages were carried out, which might lead to the loss of tissue-regenerative capacity of these 2 groups of cells in vivo. Our findings suggest that developing tissue-derived PAFSCs are a distinctive cell population from PDLSCs and might be a promising candidate for bio-root engineering.