High differentiation efficiency is one of the most important factors in developing an in vitro model from pluripotent stem cells. In this report, we improved the handling technique applied to mouse-induced pluripotent stem (iPS) cells, resulting in better differentiation into hypothalamic vasopressin (AVP) neurons. We modified the culture procedure to make the maintenance of iPS cells in an undifferentiated state much easier. Three-dimensional floating culture was demonstrated to be effective for mouse iPS cells. We also improved the differentiation method with regards to embryology, resulting in a greater number of bigger colonies of AVP neurons differentiating from mouse iPS cells. Fgf8, which was not used in the original differentiation method, increased iPS differentiation into AVP neurons. These refinements will be useful as a valuable tool for the modeling of degenerative disease in AVP neurons in vitro using disease-specific iPS cells in future studies.