Although the central nervous system is considered a comparatively static tissue with limited cell turnover, cells with stem cell properties have been isolated from most neural tissues. The spinal cord ependymal cells show neural stem cell potential in vitro and in vivo in injured spinal cord. However, very little is known regarding the ependymal niche in the mouse spinal cord. We previously reported that a secreted factor, chick Akhirin, is expressed in the ciliary marginal zone of the eye, where it works as a heterophilic cell-adhesion molecule. Here, we describe a new crucial function for mouse Akhirin (M-AKH) in regulating the proliferation and differentiation of progenitors in the mouse spinal cord. During embryonic spinal cord development, M-AKH is transiently expressed in the central canal ependymal cells, which possess latent neural stem cell properties. Targeted inactivation of the AKH gene in mice causes a reduction in the size of the spinal cord and decreases BrdU incorporation in the spinal cord. Remarkably, the expression patterns of ependymal niche molecules in AKH knockout (AKH-/-) mice are different from those of AKH+/+, both in vitro and in vivo. Furthermore, we provide evidence that AKH expression in the central canal is rapidly upregulated in the injured spinal cord. Taken together, these results indicate that M-AKH plays a crucial role in mouse spinal cord formation by regulating the ependymal niche in the central canal.