The diacylglycerol lipases (DAGLalpha and DAGLbeta) synthesize 2-arachidonoylglycerol (2-AG), a full agonist at cannabinoid receptors. Dynamic regulation of DAGL expression underpins its role in axonal growth and guidance during development, retrograde synaptic signalling at mature synapses, and maintenance of adult neurogenesis. We show here that DAGLalpha expression is dramatically down-regulated when neural stem (NS) cells are differentiated toward a gamma-aminobutyric acidergic neuronal phenotype. To understand how DAGLalpha expression might be controlled, we sought to identify the core promoter region and regulatory elements within it. The core promoter was identified and shown to contain both an enhancer and a suppressor region. Deletion analysis identified two elements, including a GC-box, that specifically promote expression in NS cells. Bioinformatic analysis identified three candidate transcription factors that might regulate DAGLalpha expression in NS cells by binding to the GC box; these were specificity protein 1 (Sp1), early growth response element 1 (EGR1), and zinc finger DNA-binding protein 89 (ZBP-89). However, Sp1 was the only factor that could bind to the GC-box. A specific mutation within the GC-box that inhibited Sp1 binding reduced DAGLalpha promoter activity in NS cells. Likewise, a dominant negative Sp1 was shown to bind to the GC-box and to suppress DAGLalpha promoter activity specifically in NS cells. Finally, like DAGLalpha, Sp1 was down-regulated during neuronal differentiation. A full characterization of the DAGLalpha promoter will help to elucidate the upstream pathways that regulate DAGLalpha expression in NS cells and their progeny.