Development of glial cell lines and axons is reported for the optic nerve of the myelin deficient rat mutant, md, 3-46 days postnatally. In mutants, optic nerves do not increase in area after 16 days of age whereas, in normal rats, they enlarge through 46 days of postnatal life. The density of glial cells, determined in cross-sections, is similar in md and normal littermates through 19 days postnatally. Thereafter, glial densities are greater in the mutant. Nonetheless, total glial counts are reduced in md as compared to the normal, because cross-sectional areas and lengths of mutant nerve 30-46 days after birth are smaller than those of age-matched, normal littermates. Differential counts of glial cells, made by ultrastructural criteria, show that md optic nerves contain abnormal, vacuolated, immature oligodendroglia from the third postnatal day. Furthermore, oligodendrocytes are reduced in number in older mutants; they constitute 1% of optic nerve neuroglia at 46 days. Astrocytic numbers are increased in relative, not in absolute, terms from 19 days, and microglial numbers are greater than normal in the oldest mutants. Reactive microglia, containing large cytoplasmic lipid droplets, constitute 4-8% of the glia of md nerve 19-46 days postnatally. Mean axonal areas are similar in normal rats and mutants at 19 and 43-46 days of age. However, mitochondrial density is greater in md axons 19 days after birth and mean areas of axonal mitochondria are significantly larger in 43-46 day mutants than in age-matched, normal littermates. Additionally, the percent area of axoplasm occupied by mitochondria is increased in md at both 19 and 43-46 days of age. The myelination defect in md appears to be due primarily to an oligodendroglial abnormality which precedes the normal age of onset of myelination. Astrocytic and microglial changes are secondary. Axonal enlargement proceeds normally over 46 days of postnatal life. Overall, the data do not provide definitive support for an axonal basis for the myelination defect, although measurable differences in axonal mitochondria between mutants and normals are demonstrable and qualitative abnormalities do occur in the axons of the mutant.