The interconversion between epithelial and mesenchymal is proposed to be a key machinery responsible for metastasis-related deaths. Likewise, cancer stem cells (CSCs) have been proposed to be a key driver of tumor metastasis. However, the linkage between the two events and their control mechanisms are unclear. We used a 3D tumor spheroid assay and other CSC-indicating assays to investigate the role of E-cadherin in CSC regulation and its association to epithelial to mesenchymal transition in lung cancer cells. Ectopic overexpression and knockdown of E-cadherin were found to promote and retard, respectively, the formation of tumor spheroids in vitro, but had opposite effects on tumor formation and metastasis in vivo in a xenograft mouse model. We explored the discrepancy between the in vitro and in vivo results and demonstrated for the first time the requirement of E-cadherin as a major survival pathway under detachment conditions. Downregulation of E-cadherin increased the stemness of lung cancer cells, but had an adverse effect on their survival, particularly on non-CSCs. Such downregulation also promoted anoikis resistance and invasiveness of lung cancer cells. These results suggest that anoikis assay could be used as an alternative assay for in vitro assessment of CSCs that involve dysregulated adhesion proteins. Our data also suggest that agents that restore E-cadherin expression may be used as therapeutic agents for metastatic cancers.