Adamantinomatous craniopharyngiomas (adaCP) cause hypothalamic pituitary dysfunction. Elucidation of pathomechanisms underlying tumor progression is essential for the development of targeted chemotherapeutic treatment options. In order to study the mechanisms of tumor outgrowth, we implanted human primary adaCP tissue from three different surgical specimens stereotactically into the brain of immunodeficient mice (n = 20). Three months after tumor inoculation, magnetic resonance imaging and histology confirmed tumor engraftment in all 20 mice (100%) that obtained tissue transplants. The lesions invaded adjoining brain tissue with micro finger‐shaped protrusions. Immunohistochemical comparison of the primary tumor and xenotransplants revealed a similar amount of proliferation (Mib‐1) and cytokeratin expression pattern (KL‐1). Whole tumor reconstruction using serial sections confirmed whirl‐like cell clusters with nuclear β‐catenin accumulations at the tumor brain border. These whirls were surrounded by a belt of Claudin‐1 expressing cells, showed an activated epidermal growth factor receptor (EGFR) and distinct CD133 as well as p21^WAF1/Cip1 positivity, indicating a tumor stem cell phenotype. Consistent with our previous in vitro studies, intracranial xenotransplants of adaCP confirmed cells with nuclear β‐catenin and activated EGFR being the driving force of tumor outgrowth. This model provides the possibility to study in vivo tumor cell migration and to test novel treatment regimens targeting this tumor stem cell niche.