Spasticity is a term, which was introduced to describe the velocity-sensitive increased resistance of a limb to manipulation in subjects with lesions of descending motor pathways. This distinguishes spasticity from the changes in passive muscle properties, which are often seen in these patients, but are not velocity-sensitive. Increased excitability of the stretch reflex is thus a central component of the definition of spasticity. This review describes changes in cellular properties and transmission in a number of spinal reflex pathways, which may explain the increased stretch reflex excitability. The review focuses mainly on results derived from the use of non-invasive electrophysiological techniques, which have been developed during the past 20-30 years to investigate spinal neuronal networks in human subjects, but work from animal models is also considered. The reflex hyperexcitability develops over several months following the primary lesion and involves adaptation in the spinal neuronal circuitries caudal to the lesion. In animal models, changes in cellular properties (such as 'plateau potentials') have been reported, but the relevance of these changes to human spasticity has not been clarified. In humans, numerous studies have suggested that reduction of spinal inhibitory mechanisms (in particular that of disynaptic reciprocal inhibition) is involved. The inter-subject variability of these mechanisms and the lack of objective quantitative measures of spasticity have impeded disclosure of a clear causal relationship between the alterations in the inhibitory mechanisms and the stretch reflex hyperexcitability. Techniques which make such a quantitative measure possible as well as longitudinal studies where development of reflex excitability and changes in the inhibitory mechanisms are followed over time are in great demand.