We introduce the notion of N-topo nilpotent fuzzy set in a fuzzy neighborhood ring and develop some fundamental results. Here we show that a fuzzy neighborhood ring is locally inversely bounded if and only if for all 0 < α < 1, the α-level topological rings are locally inversely bounded. This leads us to prove a characterization theorem which says that if a fuzzy neighborhood ring on a division ring is Wuyts-Lowen WNT 2 and locally inversely bounded, then the fuzzy neighborhood ring is a fuzzy neighborhood division ring. We also present another characterization theorem which says that a fuzzy neighborhood ring on a division ring is a fuzzy neighborhood division ring if the fuzzy neighborhood ring contains an N-topo nilpotent fuzzy neighborhood of zero.2000 Mathematics Subject Classification: 54A40, 54H13.1. Introduction. This paper is a continuation into the investigation of the compatibility of the Lowen fuzzy neighborhood topologies with algebraic structures. In the present text, we introduce and study the notion of N-topo nilpotent fuzzy set (fuzzy neighborhood topologically nilpotent fuzzy set) in a fuzzy neighborhood ring. We prove that this notion is a good extension of its classical counterpart. We also prove that the notion of bounded fuzzy set introduced in [5] is a good extension. In [2], we introduced the concept of locally inversely bounded fuzzy neighborhood ring; here we show that a fuzzy neighborhood ring is locally inversely bounded if and only if its level topological rings are locally inversely bounded. This leads us to establish two characterization theorems, which in the first place, show that if a fuzzy neighborhood ring on a division ring is Wuyts-Lowen WNT 2 and locally inversely bounded, then it is a fuzzy neighborhood division ring; and secondly, a fuzzy neighborhood ring on a division ring is a fuzzy neighborhood division ring if the fuzzy neighborhood ring contains an Ntopo nilpotent fuzzy set of fuzzy neighborhood of zero. In this regard, some pleasant properties related to N-topo nilpotency are achieved. Finally, we study the notion of N-topo quasi-regularity in connection with N-topo nilpotency in fuzzy neighborhood rings.