Neural stem cells (NSCs) divide asymmetrically to balance their self-renewal and differentiation. The imbalance can lead to NSC overgrowth and tumour formation. The function of Parafibromin, a conserved tumour suppressor, in the nervous system is not established. Here, we demonstrate that Drosophila Parafibromin/Hyrax (Hyx) inhibits NSC overgrowth by governing the cell polarity. Hyx is essential for the apicobasal polarity by localizing both apical and basal proteins asymmetrically in NSCs. hyx loss results in the symmetric division of NSCs, leading to the formation of supernumerary NSCs in the larval brain. Human Parafibromin fully rescues NSC overgrowth and cell polarity defects in Drosophila hyx mutant brains. Hyx plays a novel role in maintaining interphase microtubule-organizing center and mitotic spindle formation in NSCs. Hyx is required for the proper localization of a key centrosomal protein Polo and microtubule-binding proteins Msps and D-TACC in dividing NSCs. This study discovers that Hyx has a brain tumour suppressor-like function and maintains NSC polarity by regulating centrosome function and microtubule growth. The new paradigm that Parafibromin orchestrates cell polarity and centrosomal assembly may be relevant to Parafibromin/HRPT2-associated cancers.