The POU-domain transcription factor SCIP (also known as Tst-1) has been implicated in the development of Schwann cells, the myelinating cells of the peripheral nervous system (PNS). We have investigated the possibility that SCIP also might play a role in the development of oligodendrocytes, the myelinating cells of the central nervous system (CNS). We purified oligodendrocyte precursors (O-2A progenitors) by immunoselection and cultured them in the presence of platelet-derived growth factor (PDGF) and basic fibroblast growth factor (bFGF), which together keep O-2A progenitors proliferating and prevent oligodendrocyte differentiation. Under these culture conditions, O-2A progenitors expressed high levels of SCIP mRNA and protein, and did not express myelin-specific genes. When oligodendrocyte differentiation was initiated by withdrawing the growth factors, SCIP mRNA was rapidly down-regulated, followed by a decline in SCIP protein and the sequential activation of myelin-specific genes. Rapid down-regulation of SCIP mRNA required continued protein synthesis. In O-2A progenitors that were cultured in the presence of PDGF alone, SCIP expression declined to an intermediate level, and low levels of the myelin gene products were induced. Thus, the level of SCIP expression in O-2A progenitors is inversely related to the level of myelin gene expression, suggesting that SCIP may be involved in the developmental switch from proliferation to differentiation in the oligodendrocyte lineage. When O-2A progenitors are cultured in the presence of 10% fetal calf serum, they differentiate into type-2 astrocytes rather than oligodendrocytes. SCIP mRNA was also down-regulated in type-2 astrocytes, which do not express myelin genes, so down-regulation of SCIP seems to be more closely linked to the cessation of cell proliferation per se than the expression of a particular differentiated phenotype.