Studies on the rat optic nerve in the past 5 years have produced two surprises. First, they demonstrated that there are two biochemically, developmentally and functionally distinct types of astrocytes in the optic nerve, and probably in white matter tracts throughout the CNS: one seems to be responsible for inducing endothelial cells to form the blood-brain barrier while the other seems to service nodes of Ranvier. Second, they showed that oligodendrocytes and type-2 astrocytes develop from a common bipotential (O-2A) progenitor cell that seems to migrate into the developing optic nerve, and may well migrate all over the CNS to wherever myelination is required; this implies that the neuroepithelial cells of the optic stalk are restricted to forming type-1 astrocytes. Some of the findings in the optic nerve may be relevant to the problem of CNS regeneration after injury. These include the following. (1) Reactive gliosis in white matter tracts seems to be mainly a function of type-1 astrocytes. (2) Proliferating O-2A progenitor cells are present in the adult CNS, raising the possibility that they may be able to produce new oligodendrocytes and type-2 astrocytes following injury and thereby aid regeneration. (3) Type-1 astrocytes seem to be able to respond to environmental signals and form localized barriers that block the migration of O-2A progenitor cells; it is conceivable that the same barriers block the migration of regenerating axonal growth cones.