The inhibitory activity associated with myelin is a major obstacle for successful axon regeneration in the adult mammalian central nervous system (CNS). In addition to myelin-associated glycoprotein (MAG) and Nogo-A, available evidence suggests the existence of additional inhibitors in CNS myelin. We show here that a glycosylphosphatidylinositol (GPI)-anchored CNS myelin protein, oligodendrocyte-myelin glycoprotein (OMgp), is a potent inhibitor of neurite outgrowth in cultured neurons. Like Nogo-A, OMgp contributes significantly to the inhibitory activity associated with CNS myelin. To further elucidate the mechanisms that mediate this inhibitory activity of OMgp, we screened an expression library and identified the Nogo receptor (NgR) as a high-affinity OMgp-binding protein. Cleavage of NgR and other GPI-linked proteins from the cell surface renders axons of dorsal root ganglia insensitive to OMgp. Introduction of exogenous NgR confers OMgp responsiveness to otherwise insensitive neurons. Thus, OMgp is an important inhibitor of neurite outgrowth that acts through NgR and its associated receptor complex. Interfering with the OMgp/NgR pathway may allow lesioned axons to regenerate after injury in vivo.