Neural stem cells (NSCs) offer the potential to replace lost tissue after nervous system injury. This study investigated whether grafts of NSCs (mouse clone C17.2) could also specifically support host axonal regeneration after spinal cord injury and sought to identify mechanisms underlying such growth. In vitro, prior to grafting, C17.2 NSCs were found for the first time to naturally constitutively secrete significant quantities of several neurotrophic factors by specific ELISA, including nerve growth factor, brain-derived neurotrophic factor, and glial cell line-derived neurotrophic factor. When grafted to cystic dorsal column lesions in the cervical spinal cord of adult rats, C17.2 NSCs supported extensive growth of host axons of known sensitivity to these growth factors when examined 2 weeks later. Quantitative real-time RT-PCR confirmed that grafted stem cells expressed neurotrophic factor genes in vivo. In addition, NSCs were genetically modified to produce neurotrophin-3, which significantly expanded NSC effects on host axons. Notably, overexpression of one growth factor had a reciprocal effect on expression of another factor. Thus, stem cells can promote host neural repair in part by secreting growth factors, and their regeneration-promoting activities can be modified by gene delivery.