The transition zones (TZ) between squamous and columnar epithelium constitute hotspots for the emergence of cancers. Carcinogenesis at these sites is often preceded by the development of metaplasia, where one epithelial type invades the neighboring one. It remains unclear how these niches are restrained at the boundary between the two epithelial types and what factors contribute to metaplasia. Here we show that the cervical squamo-columnar junction derives from two distinct stem cell lineages that meet at the TZ. In contrast to the prevailing notion, our analysis of cervical tissue showed that the TZ is devoid of any locally restricted, specialized stem cell population, which has been implicated as precursor of both cervical squamous cell carcinoma and adenocarcinoma. Instead, we reveal that these cancers originate from two separate stem cell lineages. We show that the switch in the underlying Wnt signaling milieu of the stroma is a key determinant of proliferation or quiescence of epithelial stem cell lineages at the TZ. Strikingly, while the columnar lineage of the endocervix is driven by Wnt signaling, the maintenance of squamous stratified epithelium of the ectocervix and emergence of squamous metaplasia requires inhibition of Wnt signaling via expression of Dickkopf2 (Dkk2) in the underlying stroma. Moreover, Notch signaling is required for squamous cell stratification. Thus, our results indicate that homeostasis at the TZ is not maintained by a transition from one epithelial type to another but rather results from alternative signals from the stromal compartment driving the differential proliferation of the respective cell lineages at the squamo-columnar junction.