Complement has been implicated as a potential effector mechanism in neurodegeneration; yet the precise role of complement in this process remains elusive. In this report, we have utilized the cuprizone model of demyelination-remyelination to examine the contribution of complement to disease. C1q deposition was observed in the corpus callosum of C57BL/6 mice during demyelination, suggesting complement activation by apoptotic oligodendrocyte debris. Simultaneously, these mice lost expression of the rodent complement regulatory protein, Crry. A soluble CNS-specific form of the Crry protein (sCrry) expressed in a transgenic mouse under the control of an astrocyte-specific promoter was induced in the corpus callosum during cuprizone treatment. Expression of this protein completely protected the mice from demyelination. Interestingly, sCrry mice had low levels of demyelination at later times when control mice were remyelinating. Although the sCrry transgenic mice had lower levels of demyelination, there was no decrease in overall cellularity, however there were decreased numbers of microglia in the sCrry mice relative to controls. Strikingly, sCrry mice had early recovery of mature oligodendrocytes, although they later disappeared. TUNEL staining suggested that production of the sCrry protein in the transgenic mice protected from a late apoptosis event at 3 weeks of cuprizone treatment. Our data suggest complement provides some protection of mature oligodendrocytes during cuprizone treatment but may be critical for subsequent remyelination events. These data suggest that temporal restriction of complement inhibition may be required in some disease settings.