Successful myelination of the peripheral nervous system depends upon induction of major protein components of myelin, such as peripheral myelin protein 22 (PMP22). Myelin stability is also sensitive to levels of PMP22, as a 1.4 Mb duplication on human chromosome 17, resulting in three copies of PMP22, is the most common cause of the peripheral neuropathy Charcot-Marie-Tooth disease. The transcription factor Egr2/Krox20 is required for induction of high level expression of Pmp22 in Schwann cells but its activation elements have not yet been determined. Using chromatin immunoprecipitation analysis of the rat Pmp22 locus, we found a major peak of Egr2 binding within the large intron of the Pmp22 gene. Analysis of a 250 bp region within the largest intron showed that it is strongly activated by Egr2 expression in reporter assays. Moreover, this region contains conserved binding sites not only for Egr2 but also for Sox10, which is also required for Schwann cell development. Our analysis shows that Sox10 is required for optimal activity of the intronic site as well as PMP22 expression. Finally, mouse transgenic analysis revealed tissue-specific expression of this intronic sequence in peripheral nerve. Overall, these data show that Egr2 and Sox10 activity are directly involved in mediating the developmental induction of Pmp22 expression.