Demyelinating diseases, such as multiple sclerosis, are characterized by the loss of the myelin sheath around neurons, owing to inflammation and gliosis in the central nervous system (CNS). Current treatments therefore target anti-inflammatory mechanisms to impede or slow disease progression. The identification of a means to enhance axon myelination would present new therapeutic approaches to inhibit and possibly reverse disease progression. Previously, LRR and Ig domain-containing, Nogo receptor-interacting protein (LINGO-1) has been identified as an in vitro and in vivo negative regulator of oligodendrocyte differentiation and myelination. Here we show that loss of LINGO-1 function by Lingo1 gene knockout or by treatment with an antibody antagonist of LINGO-1 function leads to functional recovery from experimental autoimmune encephalomyelitis. This is reflected biologically by improved axonal integrity, as confirmed by magnetic resonance diffusion tensor imaging, and by newly formed myelin sheaths, as determined by electron microscopy. Antagonism of LINGO-1 or its pathway is therefore a promising approach for the treatment of demyelinating diseases of the CNS.