Previous reports of functional recovery from spinal cord injury (SCI) in rodents and monkeys after the delayed transplantation of neural stem/progenitor cells (NS/PCs) have raised hopes that stem cell therapy could be used to treat SCI in humans. More research is needed, however, to understand the mechanism of functional recovery. Oligodendrocytes derived from grafted NS/PCs remyelinate spared axons in the injured spinal cord. Here, we studied the extent of this remyelination's contribution to functional recovery following contusive SCI in mice. To isolate the effect of remyelination from other possible regenerative benefits of the grafted cells, NS/PCs obtained from myelin-deficient shiverer mutant mice (shi-NS/PCs) were used in this work alongside wild-type NS/PCs (wt-NS/PCs). shi-NS/PCs behaved like wt-NS/PCs in vitro and in vivo, with the exception of their myelinating potential. shi-NS/PC-derived oligodendrocytes did not express myelin basic protein in vitro and formed much thinner myelin sheaths in vivo compared with wt-NS/PC-derived oligodendrocytes. The transplantation of shi-NS/PCs promoted some locomotor and electrophysiological functional recovery but significantly less than that afforded by wt-NS/PCs. These findings establish the biological importance of remyelination by graft-derived cells for functional recovery after the transplantation of NS/PCs into the injured spinal cord. STEM CELLS 2011;29:1983–1994.