Indirect neurogenesis, during which neural stem cells generate neurons through intermediate progenitors, drives the evolution of lissencephalic brains to gyrencephalic brains. The mechanisms that specify intermediate progenitor identity and that regulate stem cell competency to generate intermediate progenitors remain poorly understood despite their roles in indirect neurogenesis. Well-characterized lineage hierarchy and available powerful genetic tools for manipulating gene functions make fruit fly neural stem cell (neuroblast) lineages an excellent in vivo paradigm for investigating the mechanisms that regulate neurogenesis. Type II neuroblasts in fly larval brains repeatedly undergo asymmetric divisions to generate intermediate neural progenitors (INPs) that undergo limited proliferation to increase the number of neurons generated per stem cell division. Here, we review key regulatory genes and the mechanisms by which they promote the specification and generation of INPs, safeguarding the indirect generation of neurons during fly larval brain neurogenesis. Homologs of these regulators of INPs have been shown to play important roles in regulating brain development in vertebrates. Insight into the precise regulation of intermediate progenitors will likely improve our understanding of the control of indirect neurogenesis during brain development and brain evolution.