We developed a rapidly-gelling chitosan sponge crosslinked with Guanosine 5'-Diphosphate (GDP). GDP has not been previously explored as an anionic crosslinker, and it was used in this application since the nucleoside guanosine has been shown to improve remyelination in situ, and thus its presence in the sponge composition was hypothesized to induce Oligodendrocyte Progenitor Cells' (OPC) differentiation. In addition to the chemical composition tailored to target OPCs, the developed chitosan sponge possesses a wide range of desirable physicochemical properties such as: rapid gelation, high porosity with interconnected pores, moduli of elasticity resembling that of soft tissue and cytocompatibility with many cell types. Moreover, protein encapsulation into the sponges was possible with high encapsulation efficiencies (e.g. BMP-7 and NT-3). In this study, BDNF was encapsulated in the chitosan sponges with an encapsulation efficiency greater than 80% and a sustained release over a 16-day period was achieved. We demonstrate here for the first time, the attachment of human fetal OPCs to the sponges and their differentiation after 12 days of culture. Overall, this newly-introduced injectable sponge is a promising therapeutic modality that can be used to enhance remyelination post-spinal cord injuries.