In preterm infants, hypoxic injury to premyelinating oligodendrocytes leads to failure of oligodendroglial maturation causing long-term neuromotor disabilities. As astrocytes influence oligodendrocyte maturation, this study aimed to analyze the transcriptomic changes in astrocytes after hypoxic injury, to identify possible pathways influencing myelination. Human fetal neural stem cell-derived astrocytes, expressing astrocyte-specific glial fibrillary-acidic protein (GFAP) and excitatory amino acid transporters (EAAT1 and EAAT2), were exposed to hypoxia (0.2% oxygen) and normoxia (20% oxygen) for 48 hours followed by RNA-sequencing. Transcriptomic analysis revealed the upregulation of cholesterol synthesis pathways in hypoxic astrocytes. Hypoxic astrocytes showed an increased expression of cholesterol synthetic and transport proteins HMG-coA reductase (HMGCR), squalene epoxidase (SQLE), apolipoprotein E and ABCA1 on western blot and qPCR (n=5). Astrocytic cell line SVG showed increased cell surface expression of ABCA1 on flow cytometry (n=3) and increased total cellular cholesterol content and efflux as measured by an enzyme-based assay (n=4). In contrast, premyelinating oligodendrocytes (Mo3.13) showed a decreased expression of HMGCR and SQLE on qPCR and western blot, and decreased cellular cholesterol on exposure to hypoxia (n=3). When SVG cells labelled with fluorescent BODIPY-cholesterol were cocultured with Mo3.13, SVG-derived cholesterol was seen in more Mo3.13 cells in hypoxic conditions as compared to normoxic controls (n=3). Moreover, treating Mo3.13 cells with exogenous cholesterol, increased their differentiation into mature oligodendrocytes (using PMA) as shown by increased myelin basic protein expression (n=3) on flow cytometry. Increased astroglial cholesterol synthesis and transport can play a neuroprotective role in hypoxic injury by influencing oligodendrocyte maturation.