The tumor microenvironment (TME) is critical for tumor progression. However, the establishment and function of the TME remain obscure because of its complex cellular composition. Using a mouse genetic system called mosaic analysis with double markers (MADMs), we delineated TME evolution at single-cell resolution in sonic hedgehog (SHH)-activated medulloblastomas that originate from unipotent granule neuron progenitors in the brain. First, we found that astrocytes within the TME (TuAstrocytes) were trans-differentiated from tumor granule neuron precursors (GNPs), which normally never differentiate into astrocytes. Second, we identified that TME-derived IGF1 promotes tumor progression. Third, we uncovered that insulin-like growth factor 1 (IGF1) is produced by tumor-associated microglia in response to interleukin-4 (IL-4) stimulation. Finally, we found that IL-4 is secreted by TuAstrocytes. Collectively, our studies reveal an evolutionary process that produces a multi-lateral network within the TME of medulloblastoma: a fraction of tumor cells trans-differentiate into TuAstrocytes, which, in turn, produce IL-4 that stimulates microglia to produce IGF1 to promote tumor progression.Copyright © 2019 Elsevier Inc. All rights reserved.