Transplantation of olfactory ensheathing cells into spinal cord lesions promotes regeneration of cut axons into terminal fields and functional recovery. This repair involves the formation of a peripheral nerve-like bridge in which perineurial-like fibroblasts are organized into a longitudinal stack of parallel tubular channels, some of which contain regenerating axons enwrapped by Schwann-like olfactory ensheathing cells. The present study examines whether cut retinal ganglion cell axons will also respond to these cells, and if so, whether they form the same type of arrangement. In adult rats, the optic nerve was completely severed behind the optic disc, and a matrix containing cultured olfactory ensheathing cells was inserted between the proximal and distal stumps. After 6 months, the transplanted cells had migrated for up to 10 mm into the distal stump. Anterograde labeling with cholera toxin B showed that cut retinal ganglion cell axons had regenerated through the transplants, entered the distal stump, and elongated for 10 mm together with the transplanted cells. Electron microscopy showed that a peripheral nerve-like tissue had been formed, similar to that seen in the spinal cord transplants. However, in contrast to the spinal cord, the axons did not reach the terminal fields, but terminated in large vesicle-filled expansions beyond which the distal optic nerve stump was reduced to a densely interwoven mass of astrocytic processes.