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The aim of this project was to determine the role of the Tissue Inhibitor of Matrix Metalloproteinases 3 (TIMP-3) in experimental allergic encephalomyelitis (EAE); a model for the human disease multiple sclerosis (MS). TIMP-3 is a potent inhibitor of matrix metalloproteases and regulates angiogenesis as well as apoptosis. During the acute phase of EAE, the clinical course in either the actively or passively induced disease was comparable to the TIMP-3-deficient (TIMP-3-/-) and wildtype (WT) mice. However, during the late phase of the disease, remission was significantly less pronounced in TIMP-3-/- mice compared with WT mice (*p≤0.05). The histopathological examinations of the spinal cords revealed that demyelinated lesions persisted and were more prominent in TIMP-3-/- mice than in WT mice. In parallel, the spinal cord of TIMP-3-/- mice showed a reduced density of proliferating oligodendroglial precursor cells which are critical for re-myelination. In addition, in the spinal cord of TIMP-3-/- mice the expression of pro-apoptotic ADAM-17 and caspase-3 was increased at the mRNA level when compared with WT mice. The ELISA analysis of TNF from the spinal cord revealed higher levels of soluble TNF in TIMP-3-/- mice compared with WT mice; this promotes through TNFR1(tumor necrosis factor receptor 1) the apoptosis of the oligodendroglial progenitors. In parallel, reduced levels of membrane-bound TNF have been measured in TIMP-3-/- mice; this promotes through TNFR2 (tumor necrosis factor receptor 2) the accumulation of proliferating oligodendrocyte progenitors. These results demonstrate that TIMP-3 is important for re-myelination in the spinal cord during EAE. Absence of remission from EAE in TIMP-3-/- mice is accompanied by a shift in TNF activation which could contribute to defective re-myelination through influencing the density of oligodendroglial precursor cells. This work contributes to our understanding of re-myelination and might lead to new therapeutic approaches for the patients with MS.