The invention provides a method of producing oligodendrocytes by in vitro differentiation of human multi-potent progenitor cells (MLPCs). The method comprises culturing isolated MLPCs on a first surface in a serum-free defined culture medium replacing the culture medium with serum-free culture medium supplemented with bFGF, EGF and PDGF-AA for approximately 24 hours changing the cultured MLPCs into the supplemented serum-free culture medium further supplemented with differentiation factors norepinephrine, forskolin. and K252a establishing a 3D environment by covering the culture with a second surface opposite and spaced apart from the first surface, so as to contain the MLPCs therebetween and continuing to culture until a majority of the MLPCs have differentiated into oligodendrocytes. Additionally included is a method of treatment for a subject afflicted by a disease characterized by central or peripheral nervous system demyelination, the method comprising transplanting into the subject oligodendrocytes produced according to the method disclosed.
