The diaphragm muscle of the mdx mouse is a model system of Duchenne muscular dystrophy, since it completely lacks dystrophin and shows severe fiber necrosis and loss of specific muscle force by 4-6 weeks of age. Changes in neuromuscular junction structure also become apparent around 4 weeks including postsynaptic acetylcholine receptor declustering, loss of postsynaptic junctional folds, abnormally complex presynaptic nerve terminals, and muscle fiber denervation. Normally, terminal Schwann cells (TSCs) cap both nerve terminals and acetylcholine receptors at the neuromuscular junction, and play a crucial role in regeneration of motor axons following muscle denervation by guiding axons to grow from innervated junctions to nearby denervated junctions. However, their role in restoring innervation in dystrophic muscle is unknown. We now show that TSCs fail to cap fully the neuromuscular junction in dystrophic muscle; TSCs extend processes, but the organization of these extensions is abnormal. TSC processes of dystrophic muscle do not form bridges from denervated fibers to nearby innervated endplates, but appear to be directed away from these endplates. Adequate signaling for TSC reactivity is present, since significant muscle fiber denervation and acetylcholine receptor declustering are present. Thus, significant structural denervation is present in the diaphragm of mdx mice and the ability of TSCs to form bridges between adjacent endplates to guide reinnervation of muscle fibers is impaired, possibly attenuating the ability of dystrophic muscle to recover from denervation and ultimately leading to muscle weakness.