Lithium, a drug that has long been used to treat bipolar disorder and some other human pathogenesis, has recently been shown to stimulate neural precursor growth. However, the involved mechanism is not clear. Here, we show that lithium induces proliferation but not survival of neural precursor cells. Mechanistic studies suggest that the effect of lithium mainly involved activation of the transcription factor NF-AT and specific induction of a subset of proliferation-related genes. While NF-AT inactivation by specific inhibition of its upstream activator calcineurin antagonized the effect of lithium on the proliferation of neural precursor cells, specific inhibition of the NF-AT inhibitor GSK-3β, similar to lithium treatment, promoted neural precursor cell proliferation. One important function of lithium appeared to increase inhibitory phosphorylation of GSK-3β, leading to GSK-3β suppression and subsequent NF-AT activation. Moreover, lithium-induced proliferation of neural precursor cells was independent of its role in inositol depletion. These findings not only provide mechanistic insights into the clinical effects of lithium, but also suggest an alternative therapeutic strategy for bipolar disorder and other neural diseases by targeting the non-canonical GSK-3β-NF-AT signaling.