Our goal is to quantify scattering properties of near-IR light in the rat spinal cord region and to differentiate healthy and demyelinated peripheral nerves intraoperatively based on differential light scattering. For the rat spinal cord, optical reflectance is measured from the spinal cord surface at spatial intervals of 1 mm using a needle probe. Data are acquired from left and right lumbar regions of the animals as well as on the central blood vessels. The reduced scattering coefficient mu(s)' is found to be higher (34.2+/-2.1 cm(-1)) in the lumbar regions of the spinal cord than on the central blood vessel (19.9+/-1.0 cm(-1)). This methodology is extended to detect differences in the rat sciatic nerves following left L4 spinal nerve ligation. The reflectance is taken at the same five regions at postoperative days 1, 4, 7, and 14. Significant differences are seen in both the spectral slope and mu(s)' values on postoperative days 4, 7, and 14, indicating that either of the two quantities could be used as a marker for demyelination. We prove the usefulness of the technique, which may have a possible clinical application for minimally invasive, intraoperative diagnosis and monitoring of demyelination diseases, such as multiple sclerosis in the central nervous system or degeneration of the peripheral nervous system.