Oligodendrocyte precursor cells (OPCs) represent the fourth major cell type within the central nervous system (CNS), ubiquitous beyond neurons, astrocytes, and microglia, constituting 5%-8% of the total cell population. They exhibit widespread distribution throughout the central nervous system, including brain, spinal cord, and optic nerve. OPCs showcase distinct protein expression, featuring platelet-derived growth factor receptor alpha (PDGFRα), neural/glial antigen 2 (NG2), SRY-related HMG-box protein 10 (Sox10), and oligodendrocyte transcription factor 2 (Olig2), endowing them with robust proliferation and migration capabilities. This capacity persists into adulthood and even later stages, contributing to the maintenance of normal neurological functions such as learning, memory, and sleep, while playing crucial roles in various neurological disorders. OPCs also display significant heterogeneity, influenced by developmental programs, stimulus-specific cellular responses, CNS locations, cell-cell interactions, and other regulatory mechanisms. Dysregulation of OPC function has been observed in various diseases, including multiple sclerosis, Alzheimer’s disease, Parkinson’s disease, amyotrophic lateral sclerosis, Pelizaeus-Merzbacher disease, as well as psychiatric disorders such as schizophrenia, depression, emotional disorders, and autism spectrum disorders. In addition to differentiating into oligodendrocytes to form myelin sheaths and supporting axonal protection, fast signal transmission, and metabolic support, OPCs actively participate in regulating neural development, circuit formation, and neural plasticity. They respond to environmental factors and are closely associated with neurological disorders. This comprehensive exploration of OPCs delves into their development, functional diversity, and associations with neurological disorders. Firstly, the article introduces the complex regulatory mechanisms of OPCs during embryonic development, encompassing transcription factors, chromatin regulatory factors, post-translational modifications of proteins, microRNA, and intercellular communication, emphasizing their significance in the nervous system. Subsequently, it reviews recent research findings on various functions of OPCs, not only in neuronal development, phagocytosis, and reshaping activities, but also involving their secretion of factors, interactions with surrounding blood vessels, and regulation of inflammatory responses. Furthermore, the review highlights the connections between OPCs and neurodegenerative diseases (such as Alzheimer’s disease, Parkinson’s disease, and multiple sclerosis) and psychiatric disorders (such as schizophrenia and depression), indicating their potential roles in disease occurrence and progression. The review then explores emerging trends in OPC research, addressing the evolving understanding of their roles in neurological health and disease. Recent studies have unveiled novel aspects of OPC functionality, shedding light on their ability to modulate immune responses, interact with the extracellular matrix, and contribute to neurovascular coupling. Additionally, insights into the role of OPCs in neuroinflammation and the crosstalk between OPCs and neurons have expanded our comprehension of their impact on neural circuits and plasticity. In conclusion, the comprehensive review summarizes the current understanding of OPC functional impairments and discusses future research directions. Emphasizing the importance of in-depth analysis of OPC heterogeneity and their roles in the development, repair, and diseases of the nervous system, this review not only provides profound insights into the multifaceted functions of OPCs in the nervous system but also sets the stage for future investigations into the intricate interplay between OPCs and the broader neural environment. With an expanded scope encompassing recent advances and emerging research trends, this review contributes to the ongoing dialogue in the field of neuroscience, fostering a deeper understanding of OPC biology and its implications for therapeutic interventions in neurological disorders.