The cellular niche that surrounds stem cells modulates their self-renewal and proliferative properties. In the nervous system glial cells form part of the neural stem cell niche and express a wide variety of ion channels. While the physiological roles of ion channels in glia have been mainly studied in the mature nervous system, the contribution of glial ion channel function in the niche to nervous system development is poorly understood. To gain insight we explored the function of the Drosophila ClC-a chloride channel since its human ortholog CLCN2 is expressed in glial cells and impairment of its function results in neurodevelopmental disorders. We found ClC-a expressed in the niche in cortex glia. These glial cells are in close association with neurogenic tissues and also wrap neuronal cell bodies as they mature away from the niche. Characterization of loss of function ClC-a mutants showed these animals had smaller brains and widespread axon guidance defects. Here we show that ClC-a is required in cortex glia for the proliferation of neuroepithelial cells and neuroblasts, as well as for neuronal survival. We could also relate the axon guidance defects observed in photoreceptors to impaired proliferation in a neuroblast lineage that generates guidepost glial cells essential for this process. Taken together, our results show that ion channels expressed in glia forming part of the neural stem cell niche can have a significant impact on nervous system development. We propose that ion channels can non-autonomously modulate the number of neural progenitors and the progeny of neuroblast lineages, consequently affecting the correct assembly of neural circuits.