Transgenic mice expressing enhanced green fluorescent protein (EGFP) driven by the mouse myelin proteolipid protein (PLP) gene promoter have been developed to investigate cells in the oligodendrocyte lineage. Transgene expression is consistent with the developmental expression of PLP, with cells at all stages of oligodendrocyte differentiation clearly visualized. These animals were analyzed to establish the time course of oligodendrocyte progenitor migration, proliferation, and differentiation in neonatal cortex. In these animals, two populations of NG2 proteoglycan-positive oligodendrocyte progenitor cells were identified that exist in postnatal subventricular zone and cortex. These two populations are distinguished by the presence or absence of PLP gene expression. Thus, PLP gene expression defines a subpopulation of NG2-positive cells from very early postnatal ages, which migrates toward the pial surface and proliferates in situ. EGFP(+)/NG2(+) cells are present in the cortex from postnatal day 1, and they remain in the cortex as undifferentiated oligodendrocyte progenitors for up to 3 weeks before myelination begins. These data could be explained by the presence of an important inhibitor of oligodendrocyte differentiation in the cortex during this period, which is downregulated in a region-specific manner to allow myelination. On the other hand, it is possible that oligodendrocyte progenitor cells remain undifferentiated in cortex until an essential signal is produced in situ to induce differentiation.