Neural crest stem cells (NCSCs), which persist in peripheral nerves throughout late gestation, are generally thought to give rise only to Schwann cells. However, Joseph and co-workers now report that NCSCs generate not only Schwann cells but also endoneurial fibroblasts in developing mouse peripheral nerves (see p. 5599). By using Crerecombinase fate mapping, the researchers show that only these cell types, and not the others present in peripheral nerves, are neural crest derived. Other results indicate that neuregulin, Notch ligands and bone morphogenetic proteins may be involved in this multilineage differentiation of NCSCs. The researchers conclude that nerve development is more complex than previously thought, involving NCSC self-renewal, lineage commitment and multilineage differentiation. They also propose that neurofibromas, which often contain both fibroblasts and cells that resemble Schwann cells, may arise from transformation of NCSCs.