1. Patch clamp studies of whole-cell ionic currents and biochemical studies of proliferation were carried out on Schwann cells of myelinated axons in explant segments of sciatic nerves of adult rabbit maintained in culture for 0-10 days. 2. Schwann cell proliferation, as assayed by [3H]thymidine incorporation and by electron microscopic autoradiography, showed an increase following nerve explant. Proliferation proceeded in parallel with a gradual hyperpolarization of the resting potential and an increase in K+ currents in Schwann cells of myelinated axons. 3. The relation between K+ channels and proliferation was studied by incubating explant nerves in the presence of various K+ channel blockers. Quinine, TEA and 4-aminopyridine (4-AP), which blocked K+ currents in Schwann cells, were found also to block Schwann cell proliferation in a dose-dependent fashion and over similar concentrations. Electron microscopy showed that TEA did not retard myelin and axonal break-down which is thought to be the source of mitogens for Schwann cell proliferation. 4. The relation between resting potential and proliferation was studied by incubating explant nerves in depolarizing culture media. Depolarizing monovalent cations (K+ and Rb+) led to a marked inhibition of Schwann cell proliferation. However, Cs+ and NH4+, which did not depolarize Schwann cells in patch clamp studies, also inhibited proliferation. Gramicidin and veratridine also inhibited proliferation. 5. The results suggest that the expression of K+ channels is functionally important for Schwann cell proliferation in Wallerian degeneration. A possible link between K+ channel and proliferation might be via a hyperpolarization of the resting membrane potential which occurs when Schwann cells proliferate.