Cholesteatoma is a severe non-cancerous lesion of the middle ear characterized by massive inflammation, tissue destruction, and an abnormal growth of keratinized squamous epithelium. We recently demonstrated the presence of pathogenic stem cells within cholesteatoma tissue, unfortunately their potential roles in regulating disease-specific chronic inflammation remain poorly understood. In the presented study, we utilized our established human in vitro cholesteatoma stem cell model for treatments with lipopolysaccharides (LPS), tumor necrosis factor α (TNFα), and the TLR4-antagonist LPS from R. sphaeroides (LPS-RS) followed by qPCR, western blot, and immunocytochemistry. Middle ear cholesteatoma stem cells (ME-CSCs) showed a significantly increased expression of TLR4 accompanied by a significantly enhanced LPS-dependent pro-inflammatory gene expression pattern of TNFα, IL-1α, IL-1ß, IL-6, and IL-8 compared to non-pathogenic control cells. LPS-dependent pro-inflammatory gene expression in ME-CSCs was driven by an enhanced activity of NF-B p65 leading to a TNFα-mediated feed-forward-loop of pro-inflammatory NF-B target gene expression. Functional inactivation of TLR4 via the TLR4-antagonist LPS-RS blocked chronic inflammation in ME-CSCs, resulting in a nearly complete loss of IL-1ß, IL-6, and TNFα expression. In summary, we determined that ME-CSCs mediate the inflammatory environment of cholesteatoma via TLR4-mediated NF-B-signaling, suggesting a distinct role of ME-CSCs as drivers of cholesteatoma progression and TLR4 on ME-CSCs as a therapeutic target.