Final answer:
The organelle responsible for breaking down toxic molecules and contributing to myelin sheath development is the peroxisome, which helps detoxify substances and is critical in the synthesis of the lipid components of the myelin sheath in nerve cells.
Step-by-step explanation:
The cellular organelle involved in breaking down potentially toxic intracellular molecules and participating in nerve cell myelin sheath development is the peroxisome. Peroxisomes play a key role in the catabolism of very long chain fatty acids, branched chain fatty acids, D-amino acids, and polyamines; the reduction of reactive oxygen species - specifically hydrogen peroxide; and the biosynthesis of plasmalogens, i.e., ether phospholipids critical for the normal function of mammalian brains and lungs. They help to detoxify substances by transferring hydrogen from them to oxygen, forming hydrogen peroxide, which is subsequently broken down into water and oxygen. In nerve cells, more specifically in the specialized structures known as oligodendrocytes in the central nervous system and Schwann cells in the peripheral nervous system, peroxisomes are essential for the synthesis of the lipid components of the myelin sheath.