Spinal muscular atrophy with respiratory distress type 1 (SMARD1) is a motor neuron disease caused by mutations in the IGHMBP2 gene, without a cure. Here, we demonstrate that neural stem cells (NSCs) from human-induced pluripotent stem cells (iPSCs) have therapeutic potential in the context of SMARD1. We show that upon transplantation NSCs can appropriately engraft and differentiate in the spinal cord of SMARD1 animals, ameliorating their phenotype, by protecting their endogenous motor neurons. To evaluate the effect of NSCs in the context of human disease, we generated human SMARD1-iPSCs motor neurons that had a significantly reduced survival and axon length. Notably, the coculture with NSCs ameliorate these disease features, an effect attributable to the production of neurotrophic factors and their dual inhibition of GSK-3 and HGK kinases. Our data support the role of iPSC as SMARD1 disease model and their translational potential for therapies in motor neuron disorders.