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CORRESP
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filename1.htm

    Sonia
      Barros

    Division
      of Corporation Finance

    Telephone
      Number: (202) 551-3655

    Telecopier
      Number: (202) 772-9217

            RE:

              Neuralstem,
                Inc.

    Amendment
      No. 3
      to Registration Statement on Form SB-2

    Filed
      August 10, 2006

    File
      No. 333-132923

    Dear
      Ms.
      Barros:

    We
      are
      submitting this letter in response to your comments of August 15, 2006.
The
      following are our proposed responses to be included in our fourth amendment
      to
      the SB2 for
      Neuralstem, Inc. I will forward under separate cover the actually proposed
      change. This correspondence will follow the lineal order of your letter and
      each
      specific area addressed, utilizing the text of your letter as the primary
      guide:

    Management’s
      Discussion and Analysis and Plan of Operation, pages
      23-28

              11.

              We
                note your response to our prior comment 5 and reissue that comment.
                We
                refer to your statement on page 24 that you “anticipate that [you] will
                approach market makers in order for them to quote [your] securities” and
                that “in the event [your] securities become quoted, [you] will be subject
                to the periodic reporting requirements of the Securities Act of 1934.”
                These statements are currently inaccurate. Your securities do not
                have to
                be “quoted for you to be subject to the periodic reporting requirements
                of
                the Securities Exchange Act of 1934. Once his registration statement
                becomes effective, you will be subject to the periodic reporting
                requirements of the Securities Exchange Act of 1934, whether or not
                your
                securities are quoted. In addition, the market makers are not the
                quotation medium. The OTCBB would be the quotation medium. Market
                Makers
                may apply to have your securities quoted on the OTCBB. Please revise
                your
                disclosure accordingly.

    Proposed
      Response: We
      have removed the reference to our securities being quoted and have revised
      the
      disclosure to accurately state that we will be subject to the reporting
      requirements of the Exchange Act upon the registration statement becoming
      effective.

    Signatures

              11.

              We
                note your response to our prior comment 7 and reissue that comment.
                You
                revised signatures still do not comply with the signatures requirements
                of
                Form SB-2. Please revise Mr. Garr’s third signature to indicate he is also
                the company’s principal accounting officer and signing for himself in that
                capacity. In addition, please note that his second signature on behalf
                of
                the company is unnecessary, unless required by the company’s governing
                documents.

    Proposed
      Response: We
      have clearly indicated that Mr. Garr is signing in his capacity as the principal
      accounting officers.

    Interim
      Financial Statements, page F-17

    Note
      4: Registration Rights Liability, page F-21

              11.

              We
                acknowledge your response to our previous comment 17. Please address
                the
                following additional comments:

              a.

              Please
                revise your registration rights disclosure here and on page 46 to
                clearly
                indicate that your one percent for each 30-day period penalties are
                prorated for partial periods as indicated in Section 8(c) of your
                Subscription Agreement for your March private
                placement.

    Proposed
      Response: We
      have revised the disclosure to clearly indicate that the penalties are prorated
      for partial periods.

              b.

              Please
                explain to us how you calculated the 33,000 shares of common stock
                to be
                issued under the registration rights as a result of your late filing
                of
                your initial registration statement on Form SB-2. It would appear
                that a
                1% penalty on 5 million shares would be 50,000 shares issuable per
                30-day
                period. Based on the February 23, 2006 private placement closing
                date you
                disclose it appears that the most days you can accrue as of March
                31, 2006
                is six days. A six day penalty would appear to be only 10,000 shares
                while
                a total nine day penalty would appear to be 15,000 shares, based
                on the
                April 3, 2006 filing date. Additionally, please clarify your disclosures
                to indicate that the penalty starts to be assessed subsequent to
                the
                initial 30-day grace period.

    Proposed
      Response: We
      have clarified our disclosure to indicate that we have already accrued a penalty
      of 9 days and that the penalty starts to be assessed subsequent to the initial
      30 day-grace period.

    Exhibits,
      page II-4

              11.

              We
                acknowledge your response to our previous comment 10. It appears
                that you
                list your investment agreement with Regal One as both Exhibits 4.6
                and
                4.17. Please confirm to us that the only difference between the two
                agreements is that Exhibit 4.6 is unexecuted. If true, please revise
                your
                Exhibit list to remove the unexecuted document. Please explain to
                us any
                other differences between the two documents and revise your Exhibit
                list
                to clarify why two agreements are
                necessary.

    Proposed
      Response: We have removed the reference to Exhibit 4.6 from the Exhibit Table.
      We are also confirming that the only difference between the two agreements
      is
      the inclusion of signatures.