Schwann cells (SCs) generate the myelin wrapping of peripheral nerve axons and are promising candidates for cell therapy. However, to date a renewable source of SCs is lacking. In this study, we show the conversion of skin fibroblasts into induced Schwann cells (iSCs) by driving the expression of two transcription factors, Sox10 and Egr2. iSCs resembled primary SCs in global gene expression profiling and PNS identity. In vitro, iSCs wrapped axons generating compact myelin sheaths with regular nodal structures. Conversely, iSCs from Twitcher mice showed a severe loss in their myelinogenic potential, demonstrating that iSCs can be an attractive system for in vitro modelling of PNS diseases. The same two factors were sufficient to convert human fibroblasts into iSCs as defined by distinctive molecular and functional traits. Generating iSCs through direct conversion of somatic cells offers opportunities for in vitro disease modelling and regenerative therapies.