The 2',3'-cyclic nucleotide 3'-phosphodiesterases (CNPs) are closely related oligodendrocyte proteins whose in vivo function is unknown. To identify subcellular sites of CNP function, the distribution of CNP and CNP mRNA was determined in tissue sections from rats of various developmental ages. Our results indicate that CNP gene products were expressed exclusively by oligodendrocytes in the CNS. CNP mRNA was concentrated around oligodendrocyte perinuclear regions during all stages of myelination. Developmentally, initial detection of CNP mRNA closely paralleled initial detection of its translation products. In electron micrographs of immunostained ultrathin cryosections, CNP was associated with oligodendrocyte membranes during the earliest phase of axonal ensheathment. In more mature fibers, immunocytochemistry established that the CNPs are not major components of compact myelin but are concentrated within specific regions of the oligodendrocyte and myelin internode. These include (a) the plasma membrane of oligodendrocytes and their processes, (b) the periaxonal membrane and inner mesaxon, (c) the outer tongue process, (d) the paranodal myelin loops, and (e) the "incisure-like" membranes found in many larger CNS myelin sheaths. A cytoplasmic pool of CNP was also detected in oligodendrocyte perikarya and larger oligodendrocyte processes. CNP was also enriched in similar locations in myelinated fibers of the PNS.