In this study, we sought to establish a novel method to prospectively and dynamically identify live human oligodendrocyte precursor cells (OPCs) and oligodendrocyte lineage cells from brain dissociates and pluripotent stem cell culture. We selected a highly conserved enhancer element of the Sox10 gene, known as MCS5, which directs reporter expression to oligodendrocyte lineage cells in mouse and zebrafish. We demonstrate that lentiviral Sox10-MCS5 induced expression of GFP at high levels in a subpopulation of human CD140a/PDGFαR-sorted OPCs as well as their immature oligodendrocyte progeny. Furthermore, we show that almost all Sox10-MCS5:GFP high cells expressed OPC antigen CD140a and human OPCs expressing SOX10, OLIG2, and PDGFRA mRNAs could be prospectively identified using GFP based fluorescence activated cells sorting alone. Additionally, we established a human induced pluripotent cell (iPSC) line transduced with the Sox10-MCS5:GFP reporter using a Rex-Neo cassette. Similar to human primary cells, GFP expression was restricted to embryoid bodies containing both oligodendrocyte progenitor and oligodendrocyte cells and co-localized with NG2 and O4-positive cells respectively. As such, we have developed a novel reporter system that can track oligodendrocyte commitment in human cells, establishing a valuable tool to improve our understanding and efficiency of human oligodendrocyte derivation.