Neural crest stem cells (NCSCs) persist in peripheral nerves throughout late gestation but their function is unknown. Current models of nerve development only consider the generation of Schwann cells from neural crest,but the presence of NCSCs raises the possibility of multilineage differentiation. We performed Cre-recombinase fate mapping to determine which nerve cells are neural crest derived. Endoneurial fibroblasts, in addition to myelinating and non-myelinating Schwann cells, were neural crest derived,whereas perineurial cells, pericytes and endothelial cells were not. This identified endoneurial fibroblasts as a novel neural crest derivative, and demonstrated that trunk neural crest does give rise to fibroblasts in vivo,consistent with previous studies of trunk NCSCs in culture. The multilineage differentiation of NCSCs into glial and non-glial derivatives in the developing nerve appears to be regulated by neuregulin, notch ligands, and bone morphogenic proteins, as these factors are expressed in the developing nerve, and cause nerve NCSCs to generate Schwann cells and fibroblasts, but not neurons, in culture. Nerve development is thus more complex than was previously thought, involving NCSC self-renewal, lineage commitment and multilineage differentiation.