Olfactory ensheathing cells (OECs) are Schwann cell-like glial cells of the olfactory system that promote neural repair under experimental conditions. It is a matter of debate in how far OECs resemble Schwann cells and whether they possess specific properties. Although OECs have been characterized mainly with respect to their regenerative effects after transplantation, both their cellular identity and the regulating factors involved have remained vague. The aim of this article is to define OEC and Schwann-cell identity in molecular terms, and to discuss crucial factors that are involved in determination in vitro and in vivo. Distinct OEC features such as the down-regulation of the low affinity neurotrophin receptor p75NTR by neuronal contact are apparent in vivo under physiological conditions, whereas OECs acquire a Schwann cell-like phenotype and up-regulate p75NTR expression in vitro and following transplantation into the lesioned spinal cord. This might indicate that establishment of the OEC phenotype depends on specific axonal stimuli. In this review we hypothesize that OECs and Schwann cells possess malleable cellular phenotypes that acquire distinct features only upon specific interaction with their natural neuronal partner. This concept is consistent with previous findings in vitro and in vivo, and might be relevant for studies that use OECs and Schwann cells for nervous system repair.