Compared to neurons, the intracellular mechanisms that control glial differentiation are still poorly understood. We show here that oligodendrocyte lineage cells express the helix-loop-helix proteins Mash1 and Id2. Although Mash1 has been found to regulate neuronal development, we found that in the absence of Mash1 oligodendrocyte differentiation occurs normally. In contrast, we found that overexpression of Id2 powerfully inhibits oligodendrocyte differentiation, that Id2 normally translocates out of the nucleus at the onset of differentiation, and that absence of Id2 induces premature oligodendrocyte differentiation in vitro. These findings demonstrate that Id2 is a component of the intracellular mechanism that times oligodendrocyte differentiation and point to the existence of an as yet unidentified MyoD-like bHLH protein necessary for oligodendrocyte differentiation.