Lipids are a major constituent of myelin and apolipoprotein E (apoE) plays a key role in lipid transport. We therefore hypothesized that apoE is involved in the processes of demyelination and remyelination. Furthermore as there is a biologically significant polymorphism in the APOE gene, the APOE genotype may influence the course of multiple sclerosis (MS). Specifically, as there is reduced affinity of the apoE E2 isoform for receptors on glial cells, we hypothesized that remyelination is impaired in individuals with the apoE epsilon2 allele. We determined the apoE genotypes of 71 archival cases of multiple sclerosis and 41 controls, reviewed the neurohistology, and performed apoE immunohistochemistry. ApoE immunoreactivity was increased in demyelinated areas compared with control white matter. ApoE immunostaining was markedly increased in areas of active demyelination, specifically in macrophages and astrocytes. The APOE allele frequencies of the cases of MS (epsilon2 = 0.06, epsilon3 = 0.8, epsilon4 = 0.13) resembled those of controls. Evidence of remyelination was identified in 25/ 71 MS cases (35%): in 25/64 patients (39%) without an epsilon2 allele and 0/7 (0%) patients with an epsilon2 allele (p < 0.05). In conclusion, we provide evidence that apoE is involved in the trafficking of lipid in MS and, although the number of cases with this allele was small, remyelination may be defective in patients with the APOE epsilon2 allele.