Multipotent neural stem cells (NSCs) have the potential to differentiate into neuronal and glial cells and are therefore candidates for cell replacement after CNS injury. Their phenotypic fate in vivo is dependent on the engraftment site, suggesting that the environment exerts differential effects on neuronal and glial lineages. In particular, when grafted into the adult spinal cord, NSCs are restricted to the glial lineage, indicating that the host spinal cord environment is not permissive for neuronal differentiation. To identify the stage at which neuronal differentiation is inhibited we examined the survival, differentiation, and integration of neuronal restricted precursor (NRP) cells, derived from the embryonic spinal cord of transgenic alkaline phosphatase rats, after transplantation into the adult spinal cord. We found that grafted NRP cells differentiate into mature neurons, survive for at least 1 month, appear to integrate within the host spinal cord, and extend processes in both the gray and white matter. Conversely, grafted glial restricted precursor cells did not differentiate into neurons. We did not observe glial differentiation from the grafted NRP cells, indicating that they retained their neuronal restricted properties in vivo. We conclude that the adult nonneurogenic CNS environment does not support the transition of multipotential NSCs to the neuronal commitment stage, but does allow the survival, maturation, and integration of NRP cells.