Glioblastoma stem cells (GSCs) are implicated in tumor neovascularization, invasiveness, and therapeutic resistance. To illuminate mechanisms governing these hallmark features, we developed a de novo glioblastoma multiforme (GBM) model derived from immortalized human neural stem/progenitor cells (hNSCs) to enable precise system-level comparisons of pre-malignant and oncogene-induced malignant states of NSCs. Integrated transcriptomic and epigenomic analyses uncovered a PAX6/DLX5 transcriptional program driving WNT5A-mediated GSC differentiation into endothelial-like cells (GdECs). GdECs recruit existing endothelial cells to promote peritumoral satellite lesions, which serve as a niche supporting the growth of invasive glioma cells away from the primary tumor. Clinical data reveal higher WNT5A and GdECs expression in peritumoral and recurrent GBMs relative to matched intratumoral and primary GBMs, respectively, supporting WNT5A-mediated GSC differentiation and invasive growth in disease recurrence. Thus, the PAX6/DLX5-WNT5A axis governs the diffuse spread of glioma cells throughout the brain parenchyma, contributing to the lethality of GBM.