Recent breakthroughs in developing human-relevant organotypic models led to the building of highly resemblant tissue constructs that hold immense potential for transplantation, drug screening, and disease modeling. Despite the progress in fine-tuning stem cell multilineage differentiation in highly controlled spatiotemporal conditions and hosting microenvironments, 3D models still experience naive and incomplete morphogenesis. In particular, existing systems and induction protocols fail to maintain stem cell long-term potency, induce high tissue-level multicellularity, or drive the maturity of stem cell-derived 3D models to levels seen in their in vivo counterparts. In this review, we highlight the use of extracellular matrix (ECM)-derived biomaterials in providing stem cell niche-mimicking microenvironment capable of preserving stem cell long-term potency and inducing spatial and region-specific differentiation. We also examine the maturation of different 3D models, including organoids, encapsulated in ECM biomaterials and provide looking-forward perspectives on employing ECM biomaterials in building more innovative, transplantable, and functional organs.