Producing dopaminergic (DA) neurons is a major goal of human embryonic stem cell (hESC) research. DA neurons can be differentiated from hESC by coculture with the mouse PA6 stromal cell line; this differentiation-inducing effect is termed stromal-derived inducing activity (SDIA). The molecular and biochemical nature of SDIA is, however, unknown. Various studies have suggested that SDIA involves either a fixation-resistant component located on the PA6 cell surface or factors secreted into the medium by PA6 cells. To address this question, hESC were cocultured with PA6 cells for 12 days and then further differentiated with sonic hedgehog homolog, fibroblast growth factor-8, and glial cell line-derived neurotrophic factor. After 18 days, 34% of cells were tyrosine hydroxylase (TH)+. When PA6 cells were fixed or irradiated, the number of TH+ cells was decreased by threefold, whereas mitomycin-c treatment of feeder cells decreased the number of TH+ cells by 32%. The neural-inducing effect of PA6 cells, as monitored by beta-III-tubulin expression, was minimally affected by mitomycin-c treatment or fixation but was decreased 50% by irradiation. Medium conditioned by PA6 cells was ineffective in differentiating TH+ cells when used alone. Conditioned medium combined with heparin and/or fixed PA6 cells produced TH+ cell differentiation, although less effectively than PA6 cell coculture. Thus, PA6 cell surface activity is required for neural differentiation of hESC, but secreted factors are required for the specific DA neuron-inducing effect. Disclosure of potential conflicts of interest is found at the end of this article.