Although initially perceived as a method to study neural development and regeneration, neural transplantation has recently become a very promising approach in its own right as a therapeutic tool to treat neurodegenerative disorders. The development of several animal models which mimic aspects of clinical disorders such as Parkinson's disease, Alzheimer's disease, and Huntington's chorea, provides systems in which to study the potential benefits of grafts derived from different sources. Both fetal and adult donor tissues presently are under investigation. Additionally, cell lines and genetically engineered cells also are being developed as suitable graft material. Important aspects of graft-host interaction, including cell survival, host regeneration, immune interactions, improved behavior, and blood-brain barrier phenomena, may be studied in these transplant models. Advances in this field of biomedical research have led to clinical trials in patients afflicted with Parkinson's disease who now are undergoing transplantation therapy. Thus far, the results have been equivocal, raising important ethical questions about continued clinical studies until more is understood about how neural transplants function and interact with the host. Nevertheless, neural transplantation holds tremendous promise as a future therapeutic tool to treat progressive and irreversible neural disorders.