Schwann cells (SCs) are known to be responsible for axonal ensheathing and myelination, and their transplantation is used commonly for treatment of spinal cord injury (SCI). 17β-estradiol (E2) has also reported for its protective roles in neurons in the transplanted SCs to the SCI model. In the current study, we evaluated the roles of E2 administration before SCs transplantation in targeting SCI-induced axonal degeneration and demyelination. E2 (25 µg/kg, IP) was administered to the male Wistar rats underwent contusive SCI at T10 segment. At 7 days after injury, 1 × 10 SCs were transplanted to the injury epicenter of the spinal cord. The groups were laminectomy, SCI, SCI+E2, and SCI+E2+SCs. Functional recovery was evaluated using the Basso-Bresnahan-Beattie locomotor test. Sections from spinal cord were also assessed for histoloical staining, including Luxol fast blue, Bielschowsky's silver and immunofluorescence evaluation of myelin basic protein (MBP). The SCI group showed impaired locomotion in the hind limb, increased number of cavities within spinal cord, low observable numbers of regenerating fibers, and a significant decrease in the rate of expression for MBP. These changes were counteracted in the treatment groups ( P < 0.05 vs SCI) with no significant changes among them. From the results, it may be concluded that application of E2 and SCs could be effective when axons undergo demyelination and degenerative processes, and their combination could partly provide cumulative outcomes.