Transplantation of peripheral nervous system glia is being explored for treating neural injuries, in particular central nervous system injuries. These glia, olfactory ensheathing cells (OECs) and Schwann cells (SCs), are thought to aid regeneration by clearing necrotic cells, (necrotic bodies, NBs), as well as myelin debris. The mechanism by which the glia phagocytose and traffic NBs are not understood. Here, we show that OECs and SCs recognize phosphatidylserine on NBs, followed by engulfment and trafficking to endosomes and lysosomes. We also showed that both glia can phagocytose and process myelin debris. We compared the time-course of glial phagocytosis (of both NBs and myelin) to that of macrophages. Internalization and trafficking were considerably slower in glia than in macrophages, and OECs were more efficient phagocytes than SCs. The two glial types also differed regarding their cytokine responses after NB challenge. SCs produced low amounts of the pro-inflammatory cytokine TNF-α while OECs did not produce detectable TNF-α. Thus, OECs have a higher capacity than SCs for phagocytosis and trafficking, whilst producing lower amounts of pro-inflammatory cytokines. These findings suggest that OEC transplantation into the injured nervous system may lead to better outcomes than SC transplantation.