Myelin is a specialized membrane enriched in glycosphingolipids and cholesterol that contains a restricted set of proteins. The mechanisms by which oligodendrocytes target myelin components to myelin are not known. To identify the sorting determinants for protein transport to myelin, we used a primary oligodendrocyte culture system in which terminal differentiation is synchronized and there is excessive deposition of myelin-like membranes (MLMs). Because several myelin proteins are palmitoylated, we explored the role of acylation in protein transport to MLMs. We found that palmitoylation-deficient mutants of a major myelin protein, proteolipid protein (PLP/DM20), were less efficiently targeted to MLMs. The N-terminal 13 amino acids of PLP/DM20, which are palmitoylated at three sites, were sufficient to direct a fluorescent fusion protein to MLMs. Mutagenesis of the N-terminal palmitoylation motif abolished the transport of the fusion protein to MLMs, indicating that palmitoylation is required for sorting to myelin. Similar results were obtained in myelinating co-cultures of oligodendrocytes and neurons. Furthermore, the combined farnesylation/palmitoylation signals from c-Ha-Ras and the N-terminal consensus sequence for dual palmitoylation from neuromodulin were sufficient for the transport of fluorescent fusion proteins to MLMs. Thus, we conclude that palmitoylation is a sorting determinant for transport to the myelin membrane.