Neurogenesis is known to persist in the adult mammalian central nervous system (CNS). The identity of the cells that generate new neurons in the postnatal CNS has become a crucial but elusive issue. Using a transgenic mouse, we show that NG2 proteoglycan–positive progenitor cells that express the 2′,3′-cyclic nucleotide 3′-phosphodiesterase gene display a multipotent phenotype in vitro and generate electrically excitable neurons, as well as astrocytes and oligodendrocytes. The fast kinetics and the high rate of multipotent fate of these NG2⁺ progenitors in vitro reflect an intrinsic property, rather than reprogramming. We demonstrate in the hippocampus in vivo that a sizeable fraction of postnatal NG2⁺ progenitor cells are proliferative precursors whose progeny appears to differentiate into GABAergic neurons capable of propagating action potentials and displaying functional synaptic inputs. These data show that at least a subpopulation of postnatal NG2-expressing cells are CNS multipotent precursors that may underlie adult hippocampal neurogenesis.