Rapid saltatory nerve conduction is facilitated by myelin structure, which is produced by Schwann cells (SC) in the peripheral nervous system (PNS). Proper development and degeneration/regeneration after injury requires regulated phenotypic changes of SC. We have previously shown that glutamate can induce SC proliferation in culture. Here we show that glutamate signals through metabotropic glutamate receptor 2 (mGluR2) to induce Erk phosphorylation in SC. mGluR2-elicited Erk phosphorylation requires ErbB2/3 receptor tyrosine kinase phosphorylation to limit the signaling cascade that promotes phosphorylation of Erk, but not Akt. We found that Gβγ and Src are involved in subcellular signaling downstream of mGluR2. We also found that glutamate can transform myelinating SC to proliferating SC, while inhibition of mGluR2 signaling can inhibit demyelination of injured nerves in vivo. These data suggest pathophysiological significance of mGluR2 signaling in PNS and its possible therapeutic importance to combat demyelinating disorders including Charcot-Marie-Tooth disease.