Cell therapy is a rapidly moving field with new cells, cell lines, and tissue-engineered constructs being developed globally. As these novel cells are further developed for transplantation studies, it is important to understand their safety profiles both prior to and posttransplantation in animals and humans. Embryonic carcinoma-derived cells are considered an important alternative to stem cells. The NTera2/D1 teratocarcinoma cell-line (or NT2-N cells) gives rise to neuron-like cells called hNT neurons after exposure to retinoic acid. NT2 cells form tumors upon transplantation into the rodent. However, when the NT2 cells are treated with retinoic acid to produce hNT cells, they terminally differentiate into post-mitotic neurons with no sign of tumorigenicity. Preliminary human transplantation studies in the brain of stroke patients also demonstrated a lack of tumorigenicity of these cells. This review focuses on the use of hNT neurons in cell transplantation for the treatment in central nervous system (CNS) diseases, disorders, or injuries and on the mechanism involved in retinoic acid exposure, final differentiation state, and subsequent tumorigenicity issues that must be considered prior to widespread clinical use.