Myelin-associated inhibitors expressed following injury to the adult central nervous system (CNS) induce growth cone collapse and retraction of the axonal cytoskeleton. Myelin-associated glycoprotein (MAG) is a bi-functional molecule that promotes neuritogenesis in some immature neurons during development then becomes inhibitory to neurite outgrowth as neurons mature. Progress is being made towards the elucidation of the downstream events that regulate myelin inhibition of regeneration in neuronal populations. However it is not known how adult-derived neural stem cells or progenitors respond to myelin during neuronal differentiation and neuritogenesis. Here we examine the effect of MAG on neurons derived from an adult rat hippocampal progenitor cell line (AHPCs). We show that, unlike their developmental counterparts, AHPC-derived neurons are susceptible to MAG inhibition of neuritogenesis during differentiation and display a 57% reduction in neurite outgrowth when compared with controls. We demonstrate that this effect can be overcome (by up to 69%) by activation of the neurotrophin, cyclic AMP and protein kinase A pathways or by Rho-kinase suppression. We also demonstrate that combination of these factors enhanced neurite outgrowth from differentiating neurons in the presence of MAG. This work provides important information for the successful generation of new neurons from adult neural stem cell populations within compromised adult circuitry and is thus directly relevant to endogenous repair and regeneration of the adult CNS.