We sought to address the fundamental question of how stem cell microenvironments can regulate self-renewal. We found that Notch was active in astroglia-like neural stem cells (NSCs), but not in transit-amplifying progenitors of the murine subependymal zone, and that the level of Notch transcriptional activity correlated with self-renewal and multipotency. Moreover, dividing NSCs appeared to balance renewal with commitment via controlled segregation of Notch activity, leading to biased expression of known (Hes1) and previously unknown (Egfr) Notch target genes in daughter cells. Pigment epithelium-derived factor (PEDF) enhanced Notch-dependent transcription in cells with low Notch signaling, thereby subverting the output of an asymmetrical division to the production of two highly self-renewing cells. Mechanistically, PEDF induced a non-canonical activation of the NF-kappaB pathway, leading to the dismissal of the transcriptional co-repressor N-CoR from specific Notch-responsive promoters. Our data provide a basis for stemness regulation in vascular niches and indicate that Notch and PEDF cooperate to regulate self-renewal.