The interaction between myelinating Schwann cells and the axons they ensheath is mediated by cell adhesion molecules of the Cadm/Necl/SynCAM family. This family consists of four members: Cadm4/Necl4 and Cadm1/Necl2 are found in both glia and axons, whereas Cadm2/Necl3 and Cadm3/Necl1 are expressed by sensory and motor neurons. By generating mice lacking each of the Cadm genes, we now demonstrate that Cadm4 plays a role in the establishment of the myelin unit in the peripheral nervous system. Mice lacking Cadm4 (PGK-Cre/Cadm4(fl/fl)), but not Cadm1, Cadm2, or Cadm3, develop focal hypermyelination characterized by tomacula and myelin outfoldings, which are the hallmark of several Charcot-Marie-Tooth neuropathies. The absence of Cadm4 also resulted in abnormal axon-glial contact and redistribution of ion channels along the axon. These neuropathological features were also found in transgenic mice expressing a dominant-negative mutant of Cadm4 lacking its cytoplasmic domain in myelinating glia Tg(mbp-Cadm4dCT), as well as in mice lacking Cadm4 specifically in Schwann cells (DHH-Cre/Cadm4(fl/fl)). Consistent with these abnormalities, both PGK-Cre/Cadm4(fl/fl) and Tg(mbp-Cadm4dCT) mice exhibit impaired motor function and slower nerve conduction velocity. These findings indicate that Cadm4 regulates the growth of the myelin unit and the organization of the underlying axonal membrane.