Charcot-Marie-Tooth disease type 1C (CMT1C) is a dominantly inherited motor and sensory neuropathy. Despite human genetic evidence linking missense mutations in SIMPLE to CMT1C, the in vivo role of CMT1C-linked SIMPLE mutations remains undetermined. To investigate the molecular mechanism underlying CMT1C pathogenesis, we generated transgenic mice expressing either wild-type or CMT1C-linked W116G human SIMPLE. Mice expressing mutant, but not wild type, SIMPLE develop a late-onset motor and sensory neuropathy that recapitulates key clinical features of CMT1C disease. SIMPLE mutant mice exhibit motor and sensory behavioral impairments accompanied by decreased motor and sensory nerve conduction velocity and reduced compound muscle action potential amplitude. This neuropathy phenotype is associated with focally infolded myelin loops that protrude into the axons at paranodal regions and near Schmidt-Lanterman incisures of peripheral nerves. We find that myelin infolding is often linked to constricted axons with signs of impaired axonal transport and to paranodal defects and abnormal organization of the node of Ranvier. Our findings support that SIMPLE mutation disrupts myelin homeostasis and causes peripheral neuropathy via a combination of toxic gain-of-function and dominant-negative mechanisms. The results from this study suggest that myelin infolding and paranodal damage may represent pathogenic precursors preceding demyelination and axonal degeneration in CMT1C patients.