Myelination requires a massive increase in glial cell membrane synthesis. Here, we demonstrate that the acute phase of myelin lipid synthesis is regulated by sterol regulatory element-binding protein (SREBP) cleavage activation protein (SCAP), an activator of SREBPs. Deletion of SCAP in Schwann cells led to a loss of SREBP-mediated gene expression involving cholesterol and fatty acid synthesis. Schwann cell SCAP mutant mice show congenital hypomyelination and abnormal gait. Interestingly, aging SCAP mutant mice showed partial regain of function; they exhibited improved gait and produced small amounts of myelin indicating a slow SCAP-independent uptake of external lipids. Accordingly, extracellular lipoproteins partially rescued myelination by SCAP mutant Schwann cells. However, SCAP mutant myelin never reached normal thickness and had biophysical abnormalities concordant with abnormal lipid composition. These data demonstrate that SCAP-mediated regulation of glial lipogenesis is key to the proper synthesis of myelin membrane, and provide insight into abnormal Schwann cell function under conditions affecting lipid metabolism.