Substantial progress has been made in identifying the extracellular signalling pathways that regulate neural stem and precursor cell biology in the central nervous system (CNS). The bone morphogenetic proteins (BMPs), in particular BMP4, are key players regulating neuronal and glial cell development from neural precursor cells in the embryonic, postnatal, and injured CNS. Here we review recent studies on BMP4 signalling in the generation of neurons, astrocytes, and oligodendroglial cells in the CNS. We also discuss putative mechanisms that BMP4 may utilise to influence glial cell development following CNS injury and highlight some questions for further research.