We report a novel role for the lysosomal galactosylceramidase (GALC), which is defective in globoid cell leukodystrophy (GLD), in maintaining a functional post-natal subventricular zone (SVZ) neurogenic niche. We show that proliferation/self-renewal of neural stem cells (NSCs) and survival of their neuronal and oligodendroglial progeny are impaired in GALC-deficient mice. Using drugs to modulate inflammation and gene transfer to rescue GALC expression and activity, we show that lipid accumulation resulting from GALC deficiency acts as a cell-autonomous pathogenic stimulus in enzyme-deficient NSCs and progeny before upregulation of inflammatory markers, which later sustain a non-cell-autonomous dysfunction. Importantly, we provide evidence that supply of functional GALC provided by neonatal intracerebral transplantation of NSCs ameliorates the functional impairment in endogenous SVZ cells. Insights into the mechanism/s underlying GALC-mediated regulation of early post-natal neurogenic niches improve our understanding of the multi-component pathology of GLD. The occurrence of a restricted period of SVZ neurogenesis in infancy supports the implications of our study for the development of therapeutic strategies to treat this severe pediatric neurodegenerative disorder.