Reports of neural transdifferentiation of mesenchymal stem cells (MSCs) suggest the possibility that these cells may serve as a source for stem cell–based regenerative medicine to treat neurological disorders. However, some recent studies controvert previous reports of MSC neurogenecity. In the current study, we evaluate the neural differentiation potential of mouse bone marrow–derived MSCs. Surprisingly, we found that MSCs spontaneously express certain neuronal phenotype markers in culture, in the absence of specialized induction reagents. A previously published neural induction protocol that elevates cytoplasmic cyclic AMP does not upregulate neuron-specific protein expression significantly in MSCs but does significantly increase expression of the astrocyte-specific glial fibrillary acidic protein. Finally, when grafted into the lateral ventricles of neonatal mouse brain, MSCs migrate extensively and differentiate into olfactory bulb granule cells and periventricular astrocytes, without evidence of cell fusion. These results indicate that MSCs may be “primed” toward a neural fate by the constitutive expression of neuronal antigens and that they seem to respond with an appropriate neural pattern of differentiation when exposed to the environment of the developing brain.