The vertebrate nervous system is characterized by ensheathment of axons with myelin, a multilamellar membrane greatly enriched in the galactolipid galactocerebroside (GalC) and its sulfated derivative sulfatide. We have generated mice lacking the enzyme UDP-galactose:ceramide galactosyltransferase (CGT), which is required for GalC synthesis. CGT-deficient mice do not synthesize GalC or sulfatide but surprisingly form myelin containing glucocerebroside, a lipid not previously identified in myelin. Microscopic and morphometric analyses revealed myelin of normal ultrastructural appearance, except for slightly thinner sheaths in the ventral region of the spinal cord. Nevertheless, these mice exhibit severe generalized tremoring and mild ataxia, and electrophysiological analysis showed conduction deficits consistent with reduced insulative capacity of the myelin sheath. Moreover, with age, CGT-deficient mice develop progressive hindlimb paralysis and extensive vacuolation of the ventral region of the spinal cord. These results indicate that GalC and sulfatide play important roles in myelin function and stability.