Apolipoprotein E (apoE), a plasma lipoprotein well known for its important role in lipid and cholesterol metabolism, has also been implicated in many neurological diseases. In this study, we examined the effect of apoE on the pathophysiology of traumatic spinal cord injury (SCI). ApoE-deficient mutant (apoE−/−) and wild-type mice received a T9 moderate contusion SCI and were evaluated using histological and behavioral analyses after injury. At 3 days after injury, the permeability of spinal cord-blood-barrier, measured by extravasation of Evans blue dye, was significantly increased in apoE−/− mice compared to wild type. The inflammation and spared white matter was also significantly increased and decreased, respectively, in apoE−/− mice compared to the wild type ones. The apoptosis of both neurons and oligodendrocytes was also significantly increased in apoE−/− mice. At 42 days after injury, the inflammation was still robust in the injured spinal cord in apoE−/− but not wild type mice. CD45 + leukocytes from peripheral blood persisted in the injured spinal cord of apoE−/− mice. The spared white matter was significantly decreased in apoE−/− mice compared to wild type ones. Locomotor function was significantly decreased in apoE−/− mice compared to wild type ones from week 1 to week 8 after contusion. Treatment of exogenous apoE mimetic peptides partially restored the permeability of spinal cord-blood-barrier in apoE−/− mice after SCI. Importantly, the exogenous apoE peptides decreased inflammation, increased spared white matter and promoted locomotor recovery in apoE−/− mice after SCI. Our results indicate that endogenous apoE plays important roles in maintaining the spinal cord-blood-barrier and decreasing inflammation and spinal cord tissue loss after SCI, suggesting its important neuroprotective function after SCI. Our results further suggest that exogenous apoE mimetic peptides could be a novel and promising neuroprotective reagent for SCI.