Sural nerve fascicles from two patients with a recessively inherited sensory neuropathy—hereditary sensory neuropathy type II (HSN II) with complete absence of myelinated fibers—were grafted into the left sciatic nerves of 30 nude mice. Nerve fascicles from age-matched healthy control subjects were grafted into the right sciatic nerves of the same mice. At 6 months, abundant myelinated fibers were found in the 10 disease xenografts studied—by visual microscopic examination not different from the paired control xenografts. The number of myelinated fibers, the size distribution of diameters of myelinated fibers, the slope and intercept of linear regression of number of myelin lamellae on area of axis cylinders of myelinated fibers, number of endoneurial nuclei (mostly Schwann cells) per cubic millimeter, and labeling indices of Schwann cell nuclei (with the use of [3H]-thymidine) did not significantly differ in disease and control xenografts. These studies indicate that the Schwann cells of HSN II can myelinate mouse axons. The absence of myelinated fibers in sensory nerves of HSN II is therefore due to an axonal abnormality—possibly a failure of development or degeneration in utero. The studies further indicate that grafted Schwann nerves of patients with cells from only unmyelinated fibers are the likely source of cells that ensheath and myelinate regenerating mouse axons. This provides further suggestive evidence for the role of axons in determining whether Schwann cells become differentiated into cells forming myelin of myelinated fibers or cells forming sheath cells of unmyelinated fibers.