Endogenous stem cells in the brain have a limited capacity to replace lost or damaged cells in neurodegenerative diseases such as Alzheimer’s and Parkinson’s. Therapeutic interventions involving cell therapy, which employ lab-cultured stem cells and their derivatives, face several challenges, including inflammatory microenvironments, poor cell survival during and after transplantation, and inadequate functional integration. Additionally, traditional drug development pathways, which rely on conventional disease models, often fail to accurately mimic the complex pathophysiological conditions of the human brain in vivo. To overcome these challenges, advanced biomaterials such as nanoparticles and hydrogels along with biofabrication technologies like 3D bioprinting have emerged as powerful tools for precisely regulating stem cell fate and behavior. Innovations in biomaterials focus on enhancing key cellular interactions with the microenvironment, including adhesion to the extracellular matrix (ECM), cell–cell communication, and signaling through soluble factors. Furthermore, the versatility of biomaterials enables the development of solutions, such as hydrogels, which serve as 3D scaffolds, providing mechanical and structural support. These materials can be engineered to interact with cells, protect transplanted cells, and help mitigate inflammatory microenvironments. In disease modeling, bioengineering approaches, such as microfluidic platforms, integrate cells or organoids with physiological stimuli, including dynamic mechanical forces, gradient-dependent signaling, and spatiotemporal control of biochemical cues, to more accurately mimic native tissue microenvironments. These systems enable high-fidelity replication of neurodegenerative hallmarks, including protein aggregation and neuronal network dysfunction, offering a more predictive platform for drug discovery. This chapter examines how advancements in bioengineering ranging from custom biomaterials to biofabricated systems are advancing the translation of stem cell-based therapies and drug development into clinical applications for neurodegenerative disorders.