The neural crest (NC) is a transient, multipotent, migratory cell population unique to vertebrates that gives rise to diverse cell lineages. Much of our knowledge of NC development comes from studies of organisms such as chicken and zebrafish because human NC is difficult to obtain because of its transient nature and the limited availability of human fetal cells. Here we examined the process of NC induction from human pluripotent stem cells, including human embryonic stem cells (hESCs) and induced pluripotent stem cells (iPSCs). We showed that NC cells could be efficiently induced from hESCs by a combination of growth factors in medium conditioned on stromal cells and that NC stem cells (NCSCs) could be purified by p75 using fluorescence-activated cell sorting (FACS). FACS-isolated NCSCs could be propagated in vitro in five passages and cryopreserved while maintaining NCSC identity characterized by the expression of a panel of NC markers such as p75, Sox9, Sox10, CD44, and HNK1. In vitro-expanded NCSCs were able to differentiate into neurons and glia (Schwann cells) of the peripheral nervous system, as well as mesenchymal derivatives. hESC-derived NCSCs appeared to behave similarly to endogenous embryonic NC cells when injected in chicken embryos. Using a defined medium, we were able to generate and propagate a nearly pure population of Schwann cells that uniformly expressed glial fibrillary acidic protein, S100, and p75. Schwann cells generated by our protocol myelinated rat dorsal root ganglia neurons in vitro. To our knowledge, this is the first report on myelination by hESC- or iPSC-derived Schwann cells.