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The nearly absent ability of the neurons to regenerate or multiply has prompted neuroscientists to search for the mean to replace damaged or dead cells. The failed attempts using adult tissue, initiated nearly a century ago, ultimately brought rays of hope when developing fetal neurons were used for transplantation in 1970s. The initial excitement was tempered by limited success and ethical issues. But these efforts unequivocally established the feasibility of successful neural transplantation provided appropriate tissue was available. The ability to derive embryonic stem cells with their totipotent potential by Thomson in 1998 rekindled the interest in their use for replacement therapy for damaged brain tissue. The present review surveys the current status of this promising field of stem cell research especially in respect to their therapeutic potentials for purposes of neural transplantation. A brief account is provided of the ongoing Indian efforts in this direction. [ABSTRACT FROM AUTHOR]