Covalent attachment of the Small ubiquitin-like modifier (Sumo) polypeptide to proteins regulates many processes in the eukaryotic cell. In the nervous system, Sumo has been associated with the synapsis and with neurodegenerative diseases. However, its involvement in regulating neuronal differentiation remains largely unknown. Here we show that net Sumo deconjugation is observed during neurogenesis and that Sumo overexpression impairs this process. In an attempt to shed light on the underlying mechanisms, we have analyzed the expression profile of genes coding for components of the sumoylation pathway following induction of neuronal differentiation. Interestingly, we observed strong upregulation of the Senp7 protease at both mRNA and protein levels under differentiation conditions. Sumo proteases, by removing Sumo from targets, are key regulators of sumoylation. Strikingly, loss-of-function analysis demonstrated that Senp7 is required for neuronal differentiation not only in a model cell line, but also in the developing neural tube. Finally, reporter-based analysis of the Senp7 promoter indicated that Senp7 was transiently activated at early stages of neuronal differentiation. Thus, the Sumo protease Senp7 adds to the list of factors involved in vertebrate neurogenesis.