Stem cells from umbilical cord would be a favorable alternative to embryonic stem cells for therapeutic applications. In this study, human multipotent progenitor cells (MLPCs) from umbilical cord were differentiated into oligodendrocytes by exposure to a range of microenvironmental chemical and physical cues. Chemical cues were represented by a novel defined differentiation medium containing the neurotransmitter norepinephrine (NE). In traditional 2 dimensional (2D) conditions, the MLPCs differentiated into oligodendrocyte precursors, but did not progress further. However, in a 3 dimensional (3D) environment, the MLPCs differentiated into committed oligodendrocytes that expressed MBP. The apparent method of interaction of NE in stimulating the differentiation process was identified to occur through the adenergic pathway while all prior differentiation methods have used other routes. This novel method of obtaining functional human oligodendrocytes from MLPCs would eliminate many of the difficulties associated with their differentiation from embryonic stem cells.