Changes in conduction properties and in morphology were studied during rat optic nerve growth from birth (when no myelin is present and the glia have not differentiated) to adulthood (when the optic nerve is essentially 100% myelinated). Myelination begins around the sixth postnatal day and proceeds rapidly so that 85% of the fibers are myelinated at 28 days of age. Mean diameter of optic nerve axons remains about 0.2 micron for the first week and then increases rapidly if the fiber is being myelinated. Those axons not being myelinated remain about 0.2-0.3 micron in diameter. At birth the compound action potential has a single negative peak and a conduction velocity of about 0.2 m/s. The increase in conduction velocity prior to myelination is considerably greater than can be accounted for on the basis of increase in axonal diameter. There is no clear step increase in the velocity of the shortest latency peak correlated with the onset of myelination. During myelination the compound action potential develops multiple short latency components, which evolve into the adult-like 3 component compound action potential by 3-4 weeks of age. Durations of the relative refractory period and supernormal period decrease as age increases, but are not related to myelination in a simple manner. Sodium appears to be the only significant carrier of inward current at all ages. A measureable calcium conductance is not present at any age. Voltage-dependent potassium conductance contributes to the compound action potential at all ages, but the response to 4-aminopyridine in rapidly conducting fibers is apparently smaller than that in slowly conducting fibers. These results show that conduction can occur before myelination or the differentiation of glial cells. Moreover, changes in conduction velocity do not depend entirely on myelination or increases in axonal size. Finally, these results suggest a reorganization of axonal membrane properties during the development of rat optic nerve.