Stem cell transplantation is heralded as an exciting and novel approach to treat a wide variety of human brain disorders for which only palliative therapies currently exist. The clinical application of stem cells for the treatment of neurological disorders such as Alzheimer disease, the most common cause of age-related dementia, remains untested. A growing body of work, however, suggests that stem cell transplantation may provide important therapeutic benefits: ameliorating cognition, memory, and locomotor function, albeit via indirect mechanisms. Although neuronal replacement strategies remain a major focus of stem cell research, recent studies indicate that stem cells may provide therapeutic utility not necessarily by replacing dead or dysfunctional cells but by enhancing the survival, health, and activity of existing endogenous neurons. In this chapter, we review the limited regenerative capacity of the brain and the potential role of adult neural stem cells in memory. We also discuss recent advances showing that neural stem cell transplantation provides therapeutic utility for neurological disease in large part via indirect mechanisms. Although neuronal replacement may provide some benefit, indirect mechanisms such as neurotrophic support, immune modulation, and enzyme replacement likely play a far more prominent role in stem cell–mediated functional recovery. Taken together, these studies suggest that at least in the short-term, harnessing or enhancing these alternate mechanisms may provide a more achievable method to treat human disease.