OBJECTIVES: Cord blood stem cells have been widely used as donor cells for bone marrow transplantation recently. These cells can give rise to a variety of hematopoietic lineages to repopulate the blood. Recent observations reveal that some bone marrow cells and bone marrow stromal cells(MSCs) can grow to become either neurons or glial cells. It is, however, unclear whether or not there exists stems cells which can differentiate into neurons in the blood during the early stages of postnatal life. METHODS: Human cord blood stem cells were prepared from human placenta after full term delivery. To induce neuronal differentiation of stem cells, beta-mercaptoethanol was treated. To confirm the neuro-glial characteristics of differentiated stem cells, immunocytochemical stain for NeuN, neurofilament, glial fibrillary acidic protein(GFAP), microtubule associated protein2(MAP2) was performed. RT-PCR was performed for detecting nestin mRNA and MAP2 mRNA. RESULTS: We showed in this experiment that neuro-glial markers(NeuN, neurofilament, MAP2, GFAP) were expressed and axon-like cytoplasmic processes are elaborated in the cultured human cord blood stem cells prepared from new born placenta after full term delivery. Nestin mRNA was also detected in fresh cord blood monocytes. Conclusions: These results suggest that human cord blood derived stem cells may be potential sources of neurons in early postnatal life.