Schwann cell myelination depends on Krox-20/Egr2 and other promyelin transcription factors that are activated by axonal signals and control the generation of myelin-forming cells. Myelin-forming cells remain remarkably plastic and can revert to the immature phenotype, a process which is seen in injured nerves and demyelinating neuropathies. We report that c-Jun is an important regulator of this plasticity. At physiological levels, c-Jun inhibits myelin gene activation by Krox-20 or cyclic adenosine monophosphate. c-Jun also drives myelinating cells back to the immature state in transected nerves in vivo. Enforced c-Jun expression inhibits myelination in cocultures. Furthermore, c-Jun and Krox-20 show a cross-antagonistic functional relationship. c-Jun therefore negatively regulates the myelinating Schwann cell phenotype, representing a signal that functionally stands in opposition to the promyelin transcription factors. Negative regulation of myelination is likely to have significant implications for three areas of Schwann cell biology: the molecular analysis of plasticity, demyelinating pathologies, and the response of peripheral nerves to injury.