Embryonic stem cells differentiate into neuroectodermal cells under specific culture conditions. In primates, these cells are organized into rosettes expressing Pax6 and Sox1 and are responsive to inductive signals such as Sonic hedgehog (Shh) and retinoic acid. However, direct derivation of organized neuroectoderm in vitro from preimplantation mammalian embryos has never been reported. Here, we show that bovine inner cell masses from nuclear transfer and fertilized embryos, grown on feeders in serum-free medium, form polarized rosette structures expressing nestin, Pax6, Pax7, Sox1, and Otx2 and exhibiting interkinetic nuclear migration activity and cell junction distribution as in the developing neural tube. After in vitro expansion, neural rosettes give rise to p75-positive neural crest precursor cell lines capable of long-term proliferation and differentiation in autonomic and sensory peripheral neurons, glial cells, melanocytes, smooth muscle cells, and chondrocytes, recapitulating in vitro the unique plasticity of the neural crest lineage. Challenging the rosette dorsal fate by early exposure to Shh induces the expression of ventral markers Isl1, Nkx2.2, and Nkx6.1 and differentiation of mature astrocytes and neurons of central nervous system ventral identity, demonstrating appropriate response to inductive signals. All together, these findings indicate that neural rosettes directly derived from cloned and fertilized bovine embryos represent an in vitro model of early neural specification and differentiation events. Moreover, this study provides a source of highly proliferative neural crest precursor cell lines of wide differentiation potential for cell therapy and tissue engineering applications.