The N20.1 immortalized cell line has several characteristics of differentiating oligodendrocytes (OLs), including expression of the glycolipids galactocerebroside (GalC) and sulfatide, and the myelin proteins CNPase and myelin basic protein (MBP) (1,2). Addition of 1–100 μM forskolin to elevate cyclic AMP (cAMP) levels changed cell morphology from irregular and flattened to a more rounded birefringent cell with multiple branched processes. GalC and sulfatide were detected immunocytochemically after permeabilization in the untreated cells and levels appeared to increase slightly following exposure to forskolin. Further analysis showed that most of the glycolipid was internal, with virtually no detectable levels on the cell surface in untreated cells and a very slight change following treatment with forskolin. Synthesis of the two lipids as measured by [H3]galactose incorporation doubled within 24 hours of treatment with forskolin. Levels of message for UDP-galactose: ceramide galactosyl transferase (CGT), a key enzyme in the synthesis of GalC and sulfatide, were compared with those of MBP and proteolipid protein (PLP), before and after elevation of cAMP. No changes were observed in levels of mRNA for CGT and PLP after 24 hours, with a possible increase by 48 hours. In contrast, levels of MBP message dropped precipitously by 24 hours; this was accompanied by an increase in levels of message for suppressed cAMP-inducible POU (SCIP). Thus CGT transcription is regulated independently of MBP and SCIP in N20.1 cells. Analysis of MBP levels by immunocytochemistry and Western blot showed little or no change in protein levels at 24 and 48 hours, in contrast to the sharp decrease in message levels by 24 hours, indicating a relatively long half life for MBP in this cell line. Thus, the N20.1 cells are an informative model for examining regulation of expression of myelinotypic proteins and GalC, as well as the transport of this lipid to the plasma membrane.