Exposure of developing rats to tellurium results in a highly synchronous segmental demyelination of peripheral nerves with sparing of axons; this demyelination is followed closely by a period of rapid remyelination. Demyelination occurs subsequent to a tellurium-induced block in the synthesis of cholesterol, the major myelin lipid. We utilized the techniques of Northern blotting, in situ hybridization, and immunocytochemistry to examine temporal alterations in Schwann cell gene expression related to demyelination and remyelination. Tellurium- induced demyelination is associated with downregulation of myelin protein expression and a corresponding upregulation of NGF receptor (NGF-R) and glial fibrillary acidic protein (GFAP) expression. Steady- state mRNA levels (expressed on a “per nerve” basis) for P0, the major myelin protein, were decreased by about 50% after 5 d of tellurium exposure, while levels of mRNA for NGF-R and GFAP were markedly increased (about 15-fold). In situ hybridization of teased fibers suggested that the increase in steady-state mRNA levels for NGF-R was primarily associated with demyelinated internodes and not with adjacent unaffected internodes. Although P0 message was almost totally absent from demyelinating internodes, it was also reduced in normal-appearing internodes as well. This suggests that limiting the supply of a required membrane component (cholesterol) may lead to partial downregulation of myelin gene expression in all myelinating Schwann cells. In partially demyelinated internodes, NGF-R and GFAP immunofluorescence appeared largely confined to the demyelinated regions. This suggests specific targeting of these proteins to local areas of the Schwann cell where there is myelin loss. These results demonstrate that demyelination is associated with reversion of the affected Schwann cells to a precursor cell phenotype. Because axons remain intact, our results suggest that these changes in Schwann cell gene expression do not require input from a degenerating axon, but instead may depend on whether concerted synthesis of myelin is occurring.