Drosophila larval brain stem cells (neuroblasts) have emerged as an important model for the study of stem cell asymmetric division and the mechanisms underlying the transformation of neural stem cells into tumour-forming cancer stem cells. Each Drosophila neuroblast divides asymmetrically to produce a larger daughter cell that retains neuroblast identity, and a smaller daughter cell that is committed to undergo differentiation. Neuroblast self-renewal and differentiation are tightly controlled by a set of intrinsic factors that regulate ACD (asymmetric cell division). Any disruption of these two processes may deleteriously affect the delicate balance between neuroblast self-renewal and progenitor cell fate specification and differentiation, causing neuroblast overgrowth and ultimately lead to tumour formation in the fly. In this review, we discuss the mechanisms underlying Drosophila neural stem cell self-renewal and differentiation. Furthermore, we highlight emerging evidence in support of the notion that defects in ACD in mammalian systems, which may play significant roles in the series of pathogenic events leading to the development of brain cancers.