Unlike in the adult brain, the newborn brain specifically takes up serum albumin during the postnatal period, coinciding with the stage of maximal brain development. Here we shall summarize our knowledge about the role played by albumin in brain development. The role of this protein in brain development is intimately related to its ability to carry fatty acids. Thus, albumin stimulates oleic acid synthesis by astrocytes from the main metabolic substrates available during brain development. Astrocytes internalize albumin in vesicle-like structures by receptor-mediated endocytosis, which is followed by transcytosis, including passage through the endoplasmic reticulum (ER). The presence of albumin in the ER activates the sterol regulatory element-binding protein-1 (SREBP-1) and increases stearoyl-CoA 9-desaturase (SCD) mRNA, the key enzyme in oleic acid synthesis. Oleic acid released by astrocytes is used by neurons for the synthesis of phospholipids and is specifically incorporated into growth cones. In addition, oleic acid promotes axonal growth, neuronal clustering, and the expression of the axonal growth associated protein, GAP-43. All of these observations indicate neuronal differentiation. The effect of oleic acid on GAP-43 synthesis is brought about by the activation of protein kinase C. The expression of GAP-43 is significantly increased by the presence of albumin in neurons co-cultured with astrocytes, indicating that neuronal differentiation takes place by the presence of oleic acid synthesized and released by astrocytes in situ. In conclusion, during brain development the presence of albumin could play an important role by triggering the synthesis and release of oleic acid by astrocytes, thereby inducing neuronal differentiation.