The adenylyl cyclase-cyclic AMP (cAMP) second messenger pathway has been proposed to regulate myelin gene expression; however, a clear correlation between endogenous cAMP levels and myelin-specific mRNA levels has never been demonstrated during the induction or maintenance of differentiation by the myelinating Schwann cell. Endogenous cAMP levels decreased to 8-10% of normal nerve by 3 days after crush or permanent transection injury of adult rat sciatic nerve. Whereas levels remained low after transection injury, cAMP levels reached only 27% of the normal values by 35 days after crush injury. Because P0 mRNA levels were 60% of normal levels by 14 days and 100% by 21 days after crush injury, cAMP increased only well after P0 gene induction. cAMP, therefore, does not appear to trigger myelin gene induction but may be involved in myelin assembly or maintenance. Forskolin, an activator of adenylyl cyclase, increased endoneurial cAMP levels only in the normal nerve, and in the crushed nerve beginning at 16 days after injury, but at no time in the transected nerve. Only by treating transected nerve with 3-isobutyl-1-methylxanthine (IBMX), an inhibitor of cAMP phosphodiesterases, in combination with forskolin was it possible to increase cAMP levels. No induction of myelin genes, however, was observed with short- or long-term treatment with IBMX and forskolin in the transected nerve. A three-fold increase in phosphodiesterase activity was observed at 35 days after both injuries, and a nonmyelinated nerve was shown to have even higher activity. These experiments, therefore, suggest an important role for phosphodiesterase in the inactivation of this second messenger-dependent stimuli when Schwann cells are non-myelinating, such as after sciatic nerve injury or in the nonmyelinated nerve, which again implies that cAMP may be required for the maintenance of the myelin sheath.