Microglia and macrophages, one a brain-resident, the other a mostly hematogenous cell type, represent two related cell types involved in the brain pathology in multiple sclerosis and its autoimmune animal model, the experimental allergic encephalomyelitis. Together, they perform a variety of different functions: they are the primary sensors of brain pathology, they are rapidly recruited to sites of infection, trauma or autoimmune inflammation in experimental allergic encephalomyelitis and multiple sclerosis and they are competent presenters of antigen and interact with T cells recruited to the inflamed CNS. They also synthesise a variety of molecules, such as cytokines (TNF, interleukins), chemokines, accessory molecules (B7, CD40), complement, cell adhesion glycoproteins (integrins, selectins), reactive oxygen radicals and neurotrophins, that could exert a damaging or a protective effect on adjacent axons, myelin and oligodendrocytes. The current review will give a detailed summary on their cellular response, describe the different classes of molecules expressed and their attribution to the blood derived or brain-resident macrophages and then discuss how these molecules contribute to the neuropathology. Recent advances using chimaeric and genetically modified mice have been particularly telling about the specific, overlapping and nonoverlapping roles of macrophages and microglia in the demyelinating disease. Interestingly, they point to a crucial role of hematogenous macrophages in initiating inflammation and myelin removal, and that of microglia in checking excessive response and in the induction and maintenance of remission.