Numerous mouse myelin mutants are available to analyze the biology of the peripheral nervous system related to health and disease in vivo. However, robust in vitro biochemical characterizations of players in peripheral nerve processes are still not possible due to the limited growth capacities of Schwann cells. In order to generate cell lines from peripheral nerves that are amenable to experimental manipulation, we have isolated Schwann cells from transgenic mice (H-2Kb-tsA58) carrying the temperature sensitive SV40 large T oncogene under the control of the interferon gamma (IFNgamma) H-2Kb promoter. These cells are immortalized at 33 degrees C when the SV40 large T antigen has a stable conformation. At the non-permissive temperature of 37 degrees C and in the absence of IFNgamma, the growth rate of the cultures reduces and typical Schwann cell markers such as p75(NGFR) become upregulated. The conditionally immortalized Schwann cells allow genetic manipulation as demonstrated here by the generation of a stable eGFP expressing cell line. They regain their characteristic non-immortalized properties at non-permissive temperature and differentiate to myelin-forming cells when seeded on dorsal root ganglia neurons. The Schwann cell lines derived are valuable tools for in vitro studies involving demyelinating diseases.