Although there is no spontaneous regeneration of mammalian spinal axons after injury, they can be enticed to grow if cAMP is elevated in the neuronal cell bodies before the spinal axons are cut. Prophylactic injection of cAMP, however, is useless as therapy for spinal injuries. We now show that the phosphodiesterase 4 (PDE4) inhibitor rolipram (which readily crosses the blood–brain barrier) overcomes inhibitors of regeneration in myelin in culture and promotes regeneration in vivo. Two weeks after a hemisection lesion at C3/4, with embryonic spinal tissue implanted immediately at the lesion site, a 10-day delivery of rolipram results in considerable axon regrowth into the transplant and a significant improvement in motor function. Surprisingly, in rolipram-treated animals, there was also an attenuation of reactive gliosis. Hence, because rolipram promotes axon regeneration, attenuates the formation of the glial scar, and significantly enhances functional recovery, and because it is effective when delivered s.c., as well as post-injury, it is a strong candidate as a useful therapy subsequent to spinal cord injury.