Cell transplantation/replacement therapy is attractive as a novel strategy for neurological diseases such as Parkinson's disease, Alzheimer's disease, and stroke. To realize this therapy, safer and more therapeutic effective cell resources are now required. Since induced pluripotent stem cells (iPSCs) can retain high replication competence and pluripotency when they differentiate into various kinds of cells, they are regarded as a promising cell source for cell transplantation therapy. However, high tumorigenesis of iPSCs has to be overcome for clinical applications. Recent progress includes the combination of novel transcriptional factors that can convert somatic cells to various kinds of mature neuronal cells and neural stem cells without requiring iPSC fate. Some evidence indicates that these directly induced neuronal cells have little tumorigenic potential. In this article, we discuss the advantage, issues, and possibility of clinical application of these cells for cell transplantation therapy.