Combined action of SOX and POU families of transcription factors plays major roles in embryonic development. In embryonic stem cells, the combination of SOX2 and POU5F1 (OCT3/4) is essential for maintaining the undifferentiated state by activating pluripotency-linked genes, and inhibition of genes involved in differentiation. Besides embryonic stem cells, POU5F1 is also present in early germ cells, primordial germ cells, and gonocytes, where it has a role in suppression of apoptosis. Here we demonstrate that SOX2 is absent in germ cells of human fetal gonads, and as expected carcinoma in situ (CIS), ie the precursor lesion of testicular germ cell tumours of adolescents and adults (TGCTs), and seminoma. Based on genome-wide expression profiling, SOX17 was found to be present, instead of SOX2, in early germ cells and their malignant counterparts, CIS and seminoma. Immunohistochemistry, western blot analysis, and quantitative RT-PCR showed that SOX17 is a suitable marker to distinguish seminoma from embryonal carcinoma, confirmed in representative cell lines. Aberrant SOX2 expression can be present in Sertoli cells when associated with CIS, which can be misdiagnosed as embryonal carcinoma. In conclusion, this study demonstrates the absence of SOX2 in human embryonic and malignant germ cells, which express SOX17 in conjunction with POU5F1. This finding has both diagnostic and developmental biological implications. It allows the identification of seminoma-like cells from embryonal carcinoma based on a positive marker and might be the explanation for the different function of POU5F1 in normal and malignant germ cells versus embryonic stem cells.