Shrm4 is a protein that is exclusively expressed in polarized tissues. The physiological function of Shrm4 in the brain was required to be elucidated. Thus, we aimed to explore how the Shrm4-mediated gamma-aminobutyric acid (GABA) pathway affected neural stem cells (NSCs). At first, the Nestin expression in cultured NSCs was identified. After determination of the interaction of Shrm4 and GABAB1, a series of in vitro experiment were performed to detect cell proliferation, the ability of cell colony formation, degree that NSCs differentiated into neurons, the apoptosis rate, and cell cycle. The levels of Shrm4, GABAB1, Bcl-2-associated protein x (Bax), B cell lymphoma 2 (Bcl-2), cleaved Caspase-3, microtubule-associated protein 2 (MAP-2) as well as suppressor of cytokine signaling 2 (SOCS2) were detected to further assess the role of Shrm4 and GABA pathway in NSCs. Initially, we found that Shrm4 could bind to GABAB1, and overexpression of Shrm4 or activation of GABAB1 increased the number of positive cells, and promoted cell viability, colony formation rate and differentiation of NSCs. After overexpression of Shrm4 or activation of GABAB1, cells in the G1 phase were decreased, while those in the S phase were increased with an inhibited cell apoptosis rate in the NSCs. Besides, the overexpression of Shrm4 or activation of GABAB1 upregulated the levels of Shrm4, GABAB1, Bcl-2, MAP-2 and SOCS2, while downregulated Bax and cleaved Caspase-3 in NSCs. Overall, overexpression of Shrm4 activated GABAB1 to stimulate the proliferation and differentiation of NSCs. Thus, Shrm4 might be considered as a novel target for promoting the proliferation and differentiation of NSCs.