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Traditionally, in vitro generation of donor cells for brain repair has been dominated by the application of extrinsic growth factors and morphogens. Recent advances in cell engineering strategies such as reprogramming of somatic cells into induced pluripotent stem cells and direct cell fate conversion have impressively demonstrated the feasibility to manipulate cell identities by the overexpression of cell fate-determining transcription factors. These strategies are now increasingly implemented for transcription factor-guided differentiation of neural precursors and forward programming of pluripotent stem cells toward specific neural subtypes. This review covers major achievements, pros and cons, as well as future prospects of transcription factor-based cell fate specification and the applicability of these approaches for the generation of donor cells for brain repair.