Oligodendrocytes play a fundamental supportive role in the mammalian central nervous system (CNS) as the myelinating-glial cells. Disruption of fast axonal transport mechanisms can occur as a consequence of mature oligodendrocyte loss following spinal cord injury, stroke, or due to neuroinflammatory conditions, such as multiple sclerosis. As a result of the limited remyelination ability in the CNS after injury or disease, human embryonic stem cells (hESCs) may prove to be a promising option for the generation and replacement of mature oligodendrocytes. Moreover, hESC-derived oligodendrocytes may be experimentally utilized to unravel fundamental questions of oligodendrocyte development, along with their therapeutic potential through growth factor support of axons and neurons. However, an intensive characterization and examination of hESC-derived oligodendrocytes prior to preclinical or clinical trials is required to facilitate greater success in their integration following cellular replacement therapy (CRT). Currently, the protocols utilized to derive oligodendrocytes from hESCs consist of significant variations in culture style, time-length of differentiation, and the provision of growth factors in culture. Further, these differing protocols also report disparate patterns in the expression of oligodendroglial markers by these derived oligodendrocytes, throughout their differentiation in culture. We have comprehensively reviewed the published protocols describing the derivation of oligodendrocytes from hESCs and the studies that examine their efficacy to remyelinate, along with the fundamental issues of their safety as a viable CRT. Additionally, this review will highlight particular issues of concern and suggestions for troubleshooting to provide investigators critical information for the future improvement of establishing in vitro hESC-derived oligodendrocytes.