In the dentate gyrus neurons continue to be generated from late embryonic to adult stage. Recent extensive studies have unveiled several key aspects of the adult neurogenesis, but only few attempts have so far been made on the analysis of the early postnatal neurogenenesis, a transition state between the embryonic and adult neurogenesis. Here, we focus on the early postnatal neurogenesis and examine the nature and development of neural progenitor cells in Wistar rats. Immunohistochemistry for Ki67, a cell cycle marker, and 5-bromo-2-deoxyuridine (BrdU) labelling show that cell proliferation occurs mainly in the hilus and partly in the subgranular zone. A majority of the proliferating cells express S100beta and astrocyte-specific glutamate transporter (GLAST) and the subpopulation are also positive for glial fibrillary acidic protein (GFAP) and nestin. Tracing with BrdU and our modified retrovirus vector carrying enhanced green fluorescent protein (GFP) indicate that a substantial population of the proliferating cells differentiate into proliferative neuroblasts and immature neurons in the hilus, which then migrate to the granule cell layer (66.8%), leaving a long axon-like process behind in the hilus, and the others mainly become star-shaped astrocytes (12.0%) and radial glia-like cells (4.7%) in the subgranular zone. These results suggest that the progenitors of the granule cells expressing astrocytic and radial glial markers, proliferate and differentiate into neurons mainly in the hilus during the early postnatal period.