The melanocortins and their receptors have been extensively investigated for their roles in the hypothalamo-pituitary-adrenal axis, but to a lesser extent in immune cells and in the nervous system outside the hypothalamic axis. This review discusses corticosteroid dependent and independent effects of melanocortins on the peripheral immune system, central nervous system (CNS) effects mediated through neuronal regulation of immune system function, and direct effects on endogenous cells in the CNS. We have focused on the expression and function of melanocortin receptors in oligodendroglia (OL), the myelin producing cells of the CNS, with the goal of identifying new therapeutic approaches to decrease CNS damage in multiple sclerosis as well as to promote repair. It is clear that melanocortin signaling through their receptors in the CNS has potential for neuroprotection and repair in diseases like MS. Effects of melanocortins on the immune system by direct effects on the circulating cells (lymphocytes and monocytes) and by signaling through CNS cells in regions lacking a mature blood brain barrier are clear. However, additional studies are needed to develop highly effective MCR targeted therapies that directly affect endogenous cells of the CNS, particularly OL, their progenitors and neurons.