Hypoxia is involved in the regulation of various cell functions in the body, including the regulation of stem cells. The hypoxic microenvironment is indispensable from embryonic development to the regeneration and repair of adult cells. In addition to embryonic stem cells, which need to maintain their self‐renewal properties and pluripotency in a hypoxic environment, adult stem cells, including neural stem cells (NSCs), also exist in a hypoxic microenvironment. The subventricular zone (SVZ) and hippocampal dentate gyrus (DG) are the main sites of adult neurogenesis in the brain. Hypoxia can promote the proliferation, migration, and maturation of NSCs in these regions. Also, because most neurons in the brain are non‐regenerative, stem cell transplantation is considered as a promising strategy for treating central nervous system (CNS) diseases. Hypoxic treatment also increases the effectiveness of stem cell therapy. In this review, we firstly describe the role of hypoxia in different stem cells, such as embryonic stem cells, NSCs, and induced pluripotent stem cells, and discuss the role of hypoxia‐treated stem cells in CNS diseases treatment. Furthermore, we highlight the role and mechanisms of hypoxia in regulating adult neurogenesis in the SVZ and DG and adult proliferation of other cells in the CNS.