Induced pluripotent stem cells (iPSCs) are reprogrammed from somatic cells via ectopic gene expression and, similarly to embryonic stem cells (ESCs), possess powerful abilities to self-renew and differentiate into cells of various lineages. However, the neural differentiation potency of iPSCs remains unknown. In this study, we demonstrated the neural differentiation ability of iPSCs compared with ESCs using an retinoic acid (RA) induction system. The neural differentiation efficiency of iPSCs was obviously lower than that of ESCs. Retinoic acid receptor-α (RARα) was critical in the RA-induced neural differentiation of iPSCs, and the effect of RARα was confirmed by applying a specific RARα antagonist ER50891 to ESCs. These findings indicate that iPSCs do not possess the complete properties that ESCs have.