Neural stem cells (NSCs) are characterized by a capacity for self-renewal, differentiation into multiple neural cell lineages, and migration toward damaged sites in the central nervous system (CNS). NSCs expanded in culture could be implanted into the brain where they integrate into host neural circuitry and stably express foreign genes. It hence appears that transplantation of NSCs has been proposed as a promising therapeutic strategy in neurological disorders. During hypoxic-ischemic (HI) brain injury, factors are transiently elaborated to which NSCs respond by migrating to degenerating regions and differentiating towards replacement of dying neural cells. In addition, NSCs serve as vehicles for gene delivery and appear capable of simultaneous neural cell replacement and gene therapy (e.g. with factors that might enhance neuronal differentiation, neurites outgrowth, proper connectivity, neuroprotection, and/or immunomodulatory substances). When combined with certain synthetic biomaterials, NSCs may be even more effective in 'engineering' the damaged CNS towards reconstitution. Human NSCs were isolated from the forebrain of an aborted fetus at 13 weeks of gestation and were grown as neurospheres in cultures. After the characterization of human NSCs in preclinical testing and the approval of the IRB, a clinical trial of the transplantation of human NSCs into patients with severe perinatal HI brain injury has been performed. The existing data from these clinical trials have shown to be safe, well tolerated, and of neurologically-some benefits. Therefore, long-term and large scale multicenter clinical study is required to determine its precise therapeutic effect and safety.