The genesis of vertebrate peripheral ganglia poses the problem of how multipotent neural crest stem cells (NCSCs) can sequentially generate neurons and then glia in a local environment containing strong instructive neurogenic factors, such as BMP2. Here we show that Notch ligands, which are normally expressed on differentiating neuroblasts, can inhibit neurogenesis in NCSCs in a manner that is completely dominant to BMP2. Contrary to expectation, Notch activation did not maintain these stem cells in an uncommitted state or promote their self-renewal. Rather, even a transient activation of Notch was sufficient to cause a rapid and irreversible loss of neurogenic capacity accompanied by accelerated glial differentiation. These data suggest that Notch ligands expressed by neuroblasts may act positively to instruct a cell-heritable switch to gliogenesis in neighboring stem cells.