Neurons and oligodendrocyte progenitors are highly sensitive to perinatal hypoxic-ischemic injury. As accumulating evidence suggests that many insults to the human infant occur in utero, and preventing brain damage to infants in utero will prove difficult, there is strong rationale to pursue regenerative strategies to reduce the morbidity associated with developmental brain injuries. The purpose of this study was to determine whether a hypoxic-ischemic insult stimulates the neural stem/progenitor cells in the subventricular zone to generate new neurons and oligodendrocytes. Hypoxia-ischemia was induced using the Vannucci rat model on postnatal day-6 pups. Injections of 5'-bromo-2'-deoxyuridine to label cells undergoing DNA synthesis after hypoxia-ischemia revealed that there is a robust proliferative response within the subventricular zone of the injured hemisphere that continues for at least 1 week after the hypoxic-ischemic episode. Using the neurosphere assay to quantify the number of neural stem/progenitor cells in the subventricular zone, we find that there are twice as many neural stem/progenitor cells in the affected dorsolateral subventricular zone at 1 week of recovery and that these cells generate larger spheres in response to growth factors compared with controls. Precursors from the injured hemisphere generate three times as many neurons in vitro and more than twice as many oligodendroglia compared with controls. Hypoxia-ischemia also increases neurogenesis in vivo. Doublecortin positive cells with migratory profiles were observed streaming from the ipsilateral subventricular zone to the striatum and neocortex, whereas, few doublecortin positive cells were found in the contralateral hemisphere after hypoxia-ischemia. These observations provide evidence that the somatic neural progenitors of the subventricular zone participate in the production of new brain cells lost after hypoxia-ischemia.