Previous studies have demonstrated that inhibitors of glycoprotein processing glucosidases interfere with the development of oligodendrocyte properties in primary cultures of embryonic rat brain cells (Bhat, J Neurosci Res 20:158-164, 1988). The present study examines the effect of castanospermine, an inhibitor of the processing glucosidases, on the development and differentiation of isolated oligodendrocyte progenitor cells. Treatment of oligodendrocyte progenitors with castanospermine did not affect the developmental progression of the precursors to become committed oligodendrocytes as revealed by comparable increases in the percentages of cells positive for galactocerebroside (a surface marker for terminally differentiated oligodendrocytes) in control and drug-treated cultures. On the other hand, there was an impairment of the expression of differentiated properties of oligodendrocytes [i.e., sulfolipid synthesis, myelin basic protein (MBP)] and 2'3'-cyclic nucleotide 3'-phosphohydrolase in the drug-treated cultures. Immunocytochemical analysis with anti-MBP antibodies revealed a reduced number of MBP-positive cells in inhibitor-treated cultures. Furthermore, a majority of MBP-positive cells in such cultures displayed immunoreactive MBP in their cell body and not the processes, unlike in control cultures where both cell body and the processes of oligodendrocytes stained intensely for MBP. The strong inhibitory effect of castanospermine on the expression of oligodendrocyte-specific activities was contrasted with a relatively smaller effect of swainsonine, a mannosidase inhibitor on oligodendrocyte differentiation. Both castanospermine and swainsonine, however, effectively blocked the formation of complex-type oligosaccharides, suggesting thereby a lack of correlation between the inhibition of the formation of complex-type oligosaccharides and oligodendrocyte differentiation. It is suggested, therefore, that early trimming reactions involving the removal of glucose residues from the high mannose oligosaccharides in the endoplasmic reticulum may be essential for the cell surface localization and function of glycoproteins critically involved in surface interactions of oligodendrocytes with each other and/or with the substratum.