To address the significance of enhancing myelination for functional recovery after white matter injury (WMI) in preterm infants, we characterized hypomyelination associated with chronic hypoxia and identified structural and functional deficits of excitatory cortical synapses with a prolonged motor deficit. We demonstrate that genetically delaying myelination phenocopies the synaptic and functional deficits observed in mice after hypoxia, suggesting that myelination may possibly facilitate excitatory presynaptic innervation. As a gain-of-function experiment, we specifically ablated the muscarinic receptor 1 (M1R), a negative regulator of oligodendrocyte differentiation in oligodendrocyte precursor cells. Genetically enhancing oligodendrocyte differentiation and myelination rescued the synaptic loss after chronic hypoxia and promoted functional recovery. As a proof of concept, drug-based myelination therapies also resulted in accelerated differentiation and myelination with functional recovery after chronic hypoxia. Together, our data indicate that myelination-enhancing strategies in preterm infants may represent a promising therapeutic approach for structural/functional recovery after hypoxic WMI.