Fetal alcohol spectrum disorder (FASD) can cause severe mental retardation in children who are prenatally exposed to ethanol. The effects of prenatal and early postnatal ethanol exposure on adult hippocampal neurogenesis have been investigated; however, the effects of prenatal ethanol exposure on the subventricular zone (SVZ) have not. Gypenosides (GPs) have been reported to have neuroprotective effects in addition to other bioactivities. The effects of GPs on neural stem cells (NSCs) in the FASD model are unknown. Here, we test the effect of prenatal ethanol exposure on the neonatal SVZ, and the protection potential of GPs on NSCs in FASD rats. Our results show that prenatal ethanol exposure can suppress the cell proliferation and differentiation of neural stem cells in the neonatal SVZ and that GPs (400 mg/kg/day) can significantly increase the cell proliferation and differentiation of neural stem cells inhibited by ethanol. Our data indicate that GPs have neuroprotective effects on the NSCs and can enhance the neurogenesis inhibited by ethanol within the SVZ of neonatal rats. These findings provide new evidence for a potential therapy involving GPs for the treatment of FASD.