Answer
$$ y= \tan(\sin^{-1}x).$$
Work Step by Step
By separation of variables, we have
$$\frac{dy}{y^2+1}=\frac{dx}{\sqrt{1-x^2}} $$
then by integration, we get
$$\tan^{-1}y=\sin^{-1}x+c\Longrightarrow y= \tan(\sin^{-1}x+c).$$
Now, since $y(0)=0$, then $c=0$.
So the general solution is given by $$ y= \tan(\sin^{-1}x).$$