Human neural progenitor cells (hNPCs) are believed to have important potential in clinical applications and basic neuroscience research. In the present study, we created a new immortalized human neural cell line, hSN12W-TERT, derived from human fetal ventral telencephalon, using IRES-based retroviral overexpression of human telomerase reverse transcriptase. We showed that after more than 40 passages, hSN12W-TERT cells possess high telomerase activity, maintain a normal diploid karyotype, and retain the characteristics of hNPCs. Under proliferative conditions, these cells remained undifferentiated, expressing the neural progenitor cell markers nestin, vimentin, and Sox2. The cells were able to differentiate into neurons, astrocytes, and oligodendrocytes after a significant decrease in the level of telomerase following withdrawal of growth factors. The neurons were postmitotic and achieved electrophysiologic competence. Furthermore, we showed that most neurons were GABAergic, especially on differentiation induced by bone morphogenetic protein-2 (BMP2). RT-PCR analysis also confirmed that hSN12W-TERT cells expressed mammalian achaete-scute homolog 1 (Mash1) and Dlx2, genes associated with the development of GABAergic cortical interneurons. BMP2 exposure may activate a positive-feedback loop of BMP signaling in hSN12W-TERT cells. Our data indicated that this hSN12W-TERT cell line could be a valuable experimental tool with which to study the regulatory roles of intrinsic and extrinsic factors in human neural stem cell biology and that it would be useful in basic research and in research seeking to discover novel drug targets for clinical candidates. (C) 2008 Wiley-Liss, Inc.