In the vertebrate embryo, the neural crest cells (NCCs) that migrate out from the neural primordium yield multiple phenotypes, including melanocytes, peripheral neurones and glia and, in the head, cartilage, bone, connective cells and myofibroblasts / vascular smooth muscle cells (SMCs). The differentiation of pluripotent NCCs is mainly directed by local growth factors. Even at postmigratory stages, NC-derived cells exhibit some fate plasticity. Thus, we reported earlier that pigment cells and Schwann cells are able in vitro to interconvert in the presence of endothelin 3 (ET3). Here, we further investigated the capacity of Schwann cells to reprogram their phenotype. We show that purified quail Schwann cells in dissociated cultures produce alpha smooth muscle actin ((alpha)SMA)-expressing myofibroblasts through the generation of a pluripotent progeny. This transdifferentiation took place independently of ET3, but was promoted by transforming growth factor beta1 (TGF(beta)1). Moreover, when implanted into chick embryos, the Schwann cells were found to contribute with host cephalic NCCs to perivascular SMCs. These data provided the first evidence for the acquisition of an NC-derived mesenchymal fate by Schwann cells and further demonstrate that the differentiation state of NC-derived cells is unstable and capable of reprogramming. The high plasticity of Schwann cells evidenced here also suggests that, as in the CNS, glial cells of the PNS may function as NC stem cells in particular circumstances such as repair.