Neurofibromas are benign tumors from patients with von Recklinghausen Neurofibromatosis (NF1) that are comprised primarily of Schwann cells. These Schwann cells are found both in association with axons and in the extracellular matrix that is prevalent in neurofibromas, and in which fibroblasts are also abundant. An unresolved question has been whether cells in neurofibromas are normal cells or are intrinsically abnormal. We have tested the hypothesis that cells in neurofibromas are abnormal and have shown that neurofibroma Schwann cells, unlike normal Schwann cells, promote angiogenesis in the chick chorioallantoic membrane model system, and invade basement membranes in this system. In contrast, neurofibroma fibroblasts neither promote angiogenic reactions nor invade basement membranes. When injected into nude mice, neurofibroma Schwann cells do not form progressive tumors. These results suggest that NF1 Schwann cells differ from normal Schwann cells, that they are preneoplastic, and that genetic and/or epigenetic changes in Schwann cells may be required for development of peripheral nerve tumors in NF1.