Microglia are the resident macrophages of the CNS and members of the innate immune system. As such, they serve important functions in surveillance for indicators of damage and subsequent initiation of an inflammatory response. Although often implicated in neural damage, recent studies have also suggested beneficial roles of activated microglia and inflammation in developmental and regenerative processes in the CNS. These include regulating events leading to the generation and regeneration of myelin, the insulation surrounding nerve fibers which is critical for nerve health and function. This critical review discusses the evidence for the supportive role of microglia in these processes and the cellular and molecular components involved.