Cellular signaling via extracellular nucleotides appears to play a major role in the functioning of the peripheral nervous system. Information regarding the functional characterization of nucleotide P2 receptors or their expression pattern has been accumulating rapidly; however, very little is known regarding the distribution of ecto-nucleotidases in the periphery. The extracellular level of nucleotides is controlled by ecto-nucleotidases, whereby the three membrane-bound members of the ecto-nucleoside triphosphate diphosphohydrolase (E-NTPDase) family are of special functional importance. Using enzyme histochemistry and immunostaining, we demonstrate that NTPDase2 is associated with nonmyelinating Schwann cells of the rat sciatic nerve, whereas NTPDase1 is restricted to blood vessel walls. NTPDase2 immunoreactivity was detected from embryonic day E18 onward, suggesting that immature Schwann cells express the enzyme. With the onset of myelination, NTPDase2 immunoreactivity remained associated solely with nonmyelinating Schwann cells. NTPDase2 was absent from perisynaptic Schwann cells but was associated with fibroblasts covering the endplate at some distance. In addition, NTPDase2 immunoreactivity was associated with the satellite glial cells in dorsal root ganglia and sympathetic ganglia, and with the enteric glia surrounding the cell bodies of ganglionic neurons of the myenteric and the submucous plexus. In contrast to NTPDase1, NTPDase2 preferentially hydrolyzes nucleoside triphosphates over nucleoside diphosphates and thus can act either in inactivating or in producing P2 receptor ligands. Our results suggest that NTPDase2 plays an important role in the control of nucleotide-mediated activation of peripheral neurons or glia and in the dialogue between these two cell types.