Background <p>NF2-related Schwannomatosis (previously referred to as Neurofibromatosis Type 2, or NF2) is a genetic-associated disease resulting from mutations in the gene, <i>NF2</i>. <i>NF2</i> encodes the Merlin protein, which acts as a tumor suppressor. Bilateral vestibular schwannoma (VS) is a hallmark of NF2. Although the exactly molecular mechanism mediating NF2-driven schwannomatosis is not fully understood, it is known that defective Merlin protein functionality leads to abnormal cell proliferation.</p> Methods <p>Herein, we utilized a human induced pluripotent stem cell (hiPSC)-based Schwann cell (SC) model to investigate the role of Merlin in human SCs. SCs were derived from hiPSCs carrying a <i>NF2</i> mutation (c.191 T &gt; C; p. L64P), its isogenic wild-type control cell line, and a NF2 patient-derived hiPSC line. Phenotypes were determined via immunocytochemistry and various bioassays. Different proteins interacting with Merlin in wild-type and NF2 mutation SCs were identified using co-immunoprecipitation followed by mass spectrometry.</p> Results <p>SC derived from NF2^L64P hiPSCs showed significantly higher proliferation and abnormal morphology compared to NF2^WT SCs. Phenotypes that could be restored by wildtype NF2 overexpression. Interactome profiling of Merlin (NF2) in SCs derived from NF2^WT- and NF2^L64P- hiPCSs identified differential protein binding levels. Among identified proteins, we validated the interaction among Merlin, an E3 ubiquitin ligase (Arkadia), and a SKI family co-repressor (SKOR2). This complex plays a significant role for this interaction in SC proliferation. Our findings were further validated by SCs derived from the patient-derived hiPSCs carrying a deletion in the chromosome 22 which spans the <i>NF2</i> gene.</p> Conclusions <p>Our results presented a hiPSC-derived SC system for SC-related disease modeling and established a new model in which Merlin interacts with Arkadia and SKOR2. This interaction is required for the proper cell proliferation in human SCs.</p>