In degenerative disorders of the central nervous system (CNS), transplantation of neural multipotent (stem) precursor cells (NPCs) is aimed at replacing damaged neural cells. Here we show that in CNS inflammation, NPCs are able to promote neuroprotection by maintaining undifferentiated features and exerting unexpected immune-like functions. In a mouse model of chronic CNS inflammation, systemically injected adult syngeneic NPCs use constitutively activated integrins and functional chemokine receptors to selectively enter the inflamed CNS. These undifferentiated cells survive repeated episodes of CNS inflammation by accumulating within perivascular areas where reactive astrocytes, inflamed endothelial cells and encephalitogenic T cells produce neurogenic and gliogenic regulators. In perivascular CNS areas, surviving adult NPCs induce apoptosis of blood-borne CNS-infiltrating encephalitogenic T cells, thus protecting against chronic neural tissue loss as well as disease-related disability. These results indicate that undifferentiated adult NPCs have relevant therapeutic potential in chronic inflammatory CNS disorders because they display immune-like functions that promote long-lasting neuroprotection.