Unlike neonatal axons, mammalian adult axons do not regenerate after injury. Likewise, myelin, a major factor in preventing regeneration in the adult, inhibits regeneration from older but not younger neurons. Identification of the molecular events responsible for this developmental loss of regenerative capacity is believed key to devising strategies to encourage regeneration in adults after injury. Here, we report that the endogenous levels of the cyclic nucleotide, cAMP, are dramatically higher in young neurons in which axonal growth is promoted both by myelin in general and by a specific myelin component, myelin-associated glycoprotein (MAG), than in the same types of neurons that, when older, are inhibited by myelin-MAG. Inhibiting a downstream effector of cAMP [protein kinase A (PKA)] prevents myelin-MAG promotion from young neurons, and elevating cAMP blocks myelin-MAG inhibition of neurite outgrowth in older neurons. Importantly, developmental plasticity of spinal tract axons in neonatal rat pups in vivo is dramatically reduced by inhibition of PKA. Thus, the switch from promotion to inhibition by myelin-MAG, which marks the developmental loss of regenerative capacity, is mediated by a developmentally regulated decrease in endogenous neuronal cAMP levels.