Nonsynaptic release of ATP from electrically stimulated dorsal root gangion (DRG) axons inhibits Schwann cell (SC) proliferation and arrests SC development at the premyelinating stage, but the specific types of purinergic receptor(s) and intracellular signaling pathways involved in this form of neuron-glia communication are not known. Recent research shows that adenosine is a neuron-glial transmitter between axons and myelinating glia of the CNS. The present study investigates the possibility that adenosine might have a similar function in communicating between axons and premyelinating SCs. Using a combination of pharmacological and molecular approaches, we found that mouse SCs in culture express functional adenosine receptors and ATP receptors, a far more complex array of purinergic receptors than thought previously. Adenosine, but not ATP, activates ERK/MAPK through stimulation of cAMP-linked A2(A) adenosine receptors. Both ATP and adenosine inhibit proliferation of SCs induced by platelet-derived growth factor (PDGF), via mechanisms that are partly independent. In contrast to ATP, adenosine failed to inhibit the differentiation of SCs to the O4+ stage. This indicates that, in addition to ATP, adenosine is an activity-dependent signaling molecule between axons and premyelinating Schwann cells, but that electrical activity, acting through adenosine, has opposite effects on the differentiation of myelinating glia in the PNS and CNS.