It has long been thought that astrocytes, like other glial cells, simply provide a support mechanism for neuronal function in the healthy and inflamed central nervous system (CNS). However, recent evidence suggests that astrocytes play an active and dual role in CNS inflammatory diseases such as multiple sclerosis (MS). Astrocytes not only have the ability to enhance immune responses and inhibit myelin repair, but they can also be protective and limit CNS inflammation while supporting oligodendrocyte and axonal regeneration. The particular impact of these cells on the pathogenesis and repair of an inflammatory demyelinating process is dependent upon a number of factors, including the stage of the disease, the type and microenvironment of the lesion, and the interactions with other cell types and factors that influence their activation. In this review, we summarize recent data supporting the idea that astrocytes play a complex role in the regulation of CNS autoimmunity.