The metabolic coupling of Schwann cells (SCs) and peripheral axons is poorly understood. Few molecules in SCs are known to regulate axon stability. Using SC-specific Rheb knockout mice, we demonstrate that Rheb-regulated mitochondrial pyruvate metabolism is critical for SC-mediated non-cell-autonomous regulation of peripheral axon stability. Rheb knockout suppresses pyruvate dehydrogenase (PDH) activity (independently of mTORC1) and shifts pyruvate metabolism toward lactate production in SCs. The increased lactate causes age-dependent peripheral axon degeneration, affecting peripheral nerve function. Lactate, as an energy substrate and a potential signaling molecule, enhanced neuronal mitochondrial metabolism and energy production of peripheral nerves. Albeit beneficial to injured peripheral axons in the short term, we show that persistently increased lactate metabolism of neurons enhances ROS production, eventually damaging mitochondria, neuroenergetics, and axon stability. This study highlights the complex roles of lactate metabolism to peripheral axons and the importance of lactate homeostasis in preserving peripheral nerves. Display omitted •Rheb KO in Schwann cells reduces PDH activity and enhances lactate production•Persistently increased lactate influx causes axonal oxidative stress and degeneration•Increased neuronal lactate exposure could be a double-edged sword Jia et al. describe a role for Rheb in the metabolic coupling between Schwann cells and peripheral axons and identify Rheb as a regulator of pyruvate metabolism and lactate production by Schwann cells. This study reveals a detrimental effect of increased lactate flux to axons, with implications for human axonopathies.