Nerve guidance conduits for peripheral nerve injuries can be improved using bioactive materials such as magnesium (Mg) and its alloys, which could provide both structural and trophic support. Therefore, we investigated whether exposure to Mg and Mg-1.6wt%Li thin films (Mg/Mg-1.6Li) would alter acute Schwann cell responses to injury. Using the RT4-D6P2T Schwannoma cell line (SCs), we tested extracts from freeze-killed cells (FKC) and nerves (FKN) as in vitro injury stimulants. Both FKC and FKN induced SC release of the macrophage chemoattractant protein 1 (MCP-1), a marker of the repair SC phenotype after injury. Next, FKC-stimulated cells exposed to Mg/Mg-1.6Li reduced MCP-1 release by 30%, suggesting that these materials could have anti-inflammatory effects. Exposing FKC-treated cells to Mg/Mg-1.6Li reduced the gene expression of the nerve growth factor (NGF), glial cell line-derived neurotrophic factor (GDNF), and myelin protein zero (MPZ), but not the p75 neurotrophin receptor. In the absence of FKC, Mg/Mg-1.6Li treatment increased the expression of NGF, p75, and MPZ, which can be beneficial to nerve regeneration. Thus, the presence of Mg can differentially alter SCs, depending on the microenvironment. These results demonstrate the applicability of this in vitro nerve injury model, and that Mg has wide-ranging effects on the repair SC phenotype.