The use of stem cells for neuroreplacement therapy is no longer science fiction - it is science fact. We have succeeded in producing neural cells in the brain using both neural and mesenchymal stem cell transplantation and even systemic injection using a small molecular compound. We have seen the improvement of cognitive function in animal models following the application of these stem cell technologies. These results may promise a bright future for stem cell based neuroreplacement therapies for neurodegenerative diseases including Alzheimer's disease (AD). However, we have to consider the pathophysiological environments of individual diseases before clinical applications can be introduced. We must find the factors in the pathology that may affect stem cell biology and overcome the negative effects on neuroreplacement. Here, we discuss not only the potential for therapeutic applications of stem cell strategies in neuropathological conditions, but also how to overcome the adverse effects on the biology of stem cells due to the factors that are altered under AD pathology.