Adult stem cells and induced pluripotent stem cells (iPS) hold great promise for regenerative medicine. The development of robust non-viral approaches for stem cell gene transfer would facilitate functional studies and potential clinical applications. We have previously generated hyperactive transposases derived from Sleeping Beauty, using an in vitro molecular evolution and selection paradigm. We now demonstrate that these hyperactive transposases resulted in superior gene transfer efficiencies and expression in mesenchymal and muscle stem/progenitor cells, consistent with higher expression levels of therapeutically relevant proteins including coagulation factor IX. Their differentiation potential and karyotype was not affected. Moreover, stable transposition could also be achieved in iPS which retained their ability to differentiate along neuronal, cardiac and hepatic lineages without causing cytogenetic abnormalities. Most importantly, transposon-mediated delivery of the myogenic PAX3 transcription factor into iPS coaxed their differentiation into MYOD(+) myogenic progenitors and multinucleated myofibers, suggesting that PAX3 may serve as a myogenic "molecular switch" in iPS. Hence, this hyperactive transposon system represents an attractive non-viral gene transfer platform with broad implications for regenerative medicine, cell and gene therapy.