The development of biodegradable polymeric scaffolds with surface properties that dominate interactions between the material and biological environment is of great interest in biomedical applications. In this regard, poly-ε-caprolactone (PCL) nanofibrous scaffolds were fabricated by an electrospinning process and surface modified by a simple plasma treatment process for enhancing the Schwann cell adhesion, proliferation and interactions with nanofibers necessary for nerve tissue formation. The hydrophilicity of surface modified PCL nanofibrous scaffolds (p-PCL) was evaluated by contact angle and x-ray photoelectron spectroscopy studies. Naturally derived polymers such as collagen are frequently used for the fabrication of biocomposite PCL/collagen scaffolds, though the feasibility of procuring large amounts of natural materials for clinical applications remains a concern, along with their cost and mechanical stability. The proliferation of Schwann cells on p-PCL nanofibrous scaffolds showed a 17% increase in cell proliferation compared to those on PCL/collagen nanofibrous scaffolds after 8 days of cell culture. Schwann cells were found to attach and proliferate on surface modified PCL nanofibrous scaffolds expressing bipolar elongations, retaining their normal morphology. The results of our study showed that plasma treated PCL nanofibrous scaffolds are a cost-effective material compared to PCL/collagen scaffolds, and can potentially serve as an ideal tissue engineered scaffold, especially for peripheral nerve regeneration.