Medulloblastoma, one of the most malignant brain tumors in children, is thought to arise from undifferentiated neural stem/progenitor cells (NSCs) present in the external granule layer of the cerebellum. However, the mechanism of tumorigenesis remains unknown for the majority of medulloblastomas. In this study, we found that many human medulloblastomas express significantly elevated levels of both myc oncogenes, regulators of neural progenitor proliferation, and REST/NRSF, a transcriptional repressor of neuronal differentiation genes. Previous studies have shown that neither c-Myc nor REST/NRSF alone could cause tumor formation. To determine whether c-Myc and REST/NRSF act together to cause medulloblastomas, we used a previously established cell line derived from external granule layer stem cells transduced with activated c-myc (NSC-M). These immortalized NSCs were able to differentiate into neurons in vitro. In contrast, when the cells were engineered to express a doxycycline-regulated REST/NRSF transgene (NSC-M-R), they no longer underwent terminal neuronal differentiation in vitro. When injected into intracranial locations in mice, the NSC-M cells did not form tumors either in the cerebellum or in the cerebral cortex. In contrast, the NSC-M-R cells did produce tumors in the cerebellum, the site of human medulloblastoma formation, but not when injected into the cerebral cortex. Furthermore, the NSC-M-R tumors were blocked from terminal neuronal differentiation. In addition, countering REST/NRSF function blocked the tumorigenic potential of NSC-M-R cells. To our knowledge, this is the first study in which abnormal expression of a sequence-specific DNA-binding transcriptional repressor has been shown to contribute directly to brain tumor formation. Our findings indicate that abnormal expression of REST/NRSF and Myc in NSCs causes cerebellum-specific tumors by blocking neuronal differentiation and thus maintaining the "stemness" of these cells. Furthermore, these results suggest that such a mechanism plays a role in the formation of human medulloblastoma.