Neural stem cells (NSCs) exist in vascularized niches. Although there has been ample evidence supporting a role for endothelial cell-derived soluble factors as modulators of neural stem cell self-renewal and neuronal differentiation there is a paucity of data reported on neural stem cell modulation of endothelial cell behavior. We show that co-culture of NSCs with brain-derived endothelial cells (BECs) either in direct contact or separated by a porous membrane elicited robust vascular tube formation and maintenance, mediated by induction of vascular vascular endothelial growth factor (VEGF) and brain-derived neurotrophic factor (BDNF) and activation of vascular VEGFR2 and TrkB by NSC NO. Nitric oxide (NO) scavengers and sequestration of VEGF and BDNF blunted this induction of tube formation, whereas addition of exogenous NO donor, rBDNF and rVEGF rescued the induction of tube formation. Further, rBDNF enhanced NSC eNOS activation and NO generation, suggesting an inducible positive feed-back signaling loop between NSCs and BECs, providing for homeostasis and responsiveness of the resident NSCs and BECs comprising the neurovascular niche. These findings show the importance of reciprocal modulation of NSCs and BECs in induction and maintenance of the neurovascular niche and underscores their dynamic interactions.