Using neural stem cells (NSCs) with tumor tropic migratory capacity to deliver therapeutic genes is an attractive strategy in eliminating metastatic or disseminated tumors. While different methods have been developed to isolate or generate NSCs, it has not been assessed whether induced pluripotent stem (iPS) cells, a type of pluripotent stem cells that hold great potential for regenerative medicine, can be used as a source for derivation of NSCs with tumor tropism. In this study, we used a conventional lentivirus transduction method to derive iPS cells from primary mouse embryonic fibroblasts and then generated NSCs from the iPS cells. To investigate whether the iPS cell derived NSCs can be used in the treatment of disseminated brain tumors, the cells were transduced with a baculoviral vector containing the herpes simplex virus thymidine kinase suicide gene and injected into the cerebral hemisphere contralateral to a tumor inoculation site in a mouse intracranial human glioma xenograft model. We observed that NSCs expressing the suicide gene were, in the presence of ganciclovir, effective in inhibiting the growth of the glioma xenografts and prolonging survival of tumor-bearing mice. Our findings provide evidence for the feasibility of using iPS cell derived NSCs as cellular vehicles for targeted anticancer gene therapy.