Astrocytes emerge as crucial cells for proper neuronal functioning in the developing and adult brain. Neurons and astrocytes are sequentially generated from the same pool of neural stem cells (NSCs). Tight regulation of the neuron-to-astrocyte switch is critical for (1) the generation of a balanced number of astrocytes and neurons and (2) neuronal circuit formation, since newborn astrocytes regulate synapse formation. This review focuses on signaling pathways that instruct astrogenesis, incorporating recently discovered intrinsic and extrinsic regulators. The canonical pathway of astrocytic gene expression, JAK/STAT signaling, is inhibited during neurogenesis to prevent premature astrocyte differentiation. At the onset of astrogenesis, Notch signaling induces epigenetic remodeling of astrocytic genes like glial fibrillary acidic protein to change NSC competence. In turn, astrogenesis is initiated by signals received from newborn neurons. We highlight how key molecular pathways like JAK/STAT and Notch are integrated in a complex network of environmental signals and epigenetic and transcriptional regulators to determine NSC differentiation. It is essential to understand NSC differentiation in respect to future NSC-based therapies for brain diseases, as transplanted NSCs preferentially become astrocytes. As emphasized in this review, many clues in this respect can be learned from development.