Developing oligodendrocytes undergo a well-characterized maturation process that is controlled by extrinsic factors that promote specification, proliferation, and differentiation. Inhibitory factors also influence oligodendrocyte development and may regulate the location and number of oligodendrocytes available for myelination. These factors may also repress regeneration and remyelination after injury. Bone morphogenetic proteins (BMPs) comprise a family of factors that inhibit oligodendrocyte development in vitro and when they are overexpressed in vivo. These effects seem to be mediated by the actions of inhibitors of DNA-binding protein on transcription factors that promote myelination. Bone morphogenetic protein signaling deletion studies have generated a complex picture in which the main effect of BMPs is on oligodendrocyte differentiation and depends on the level of signaling. Bone morphogenetic proteins are significantly upregulated in demyelinated areas in models of myelin injury and disease, and blocking of BMP signaling aids recovery. It is not yet known, however, whether this occurs by promoting differentiation of oligodendrocyte precursors or by inhibiting astrogliosis because BMPs also promote astrogliogenesis. Understanding the actions of BMPs will be important for promoting recovery in patients with demyelinating diseases and other types of CNS injury.