Sixteen of 17 sheep with spontaneous listeric encephalitis had neuritis characterized by diffuse and focal intrafascicular and perineural accumulations of lymphocytes, plasma cells, macrophages and neutrophils in one or more cranial nerves. Nine sheep had extensive trigeminal neuritis which was usually unilateral. Brain lesions were mainly in the stem and were foci of macrophages or neutrophils or both, malacia, neutrophilic neuronophagia, vascular cuffing, and meningitis. Lesions in the brain and trigeminal ganglia were most severe on the same side as the affected trigeminal nerve. Gram-positive bacilli were in proximal parts of cranial nerves in foci of inflammatory cells and occasionally in morphologically intact nerve fibers. Organisms in the brain were in phagocytes in areas of inflammation and in scattered neurons and axons. The results were consistent with centripetal migration of the infectious agent along one or more branches of the trigeminal nerve to the brain and dissemination in the brain stem occurring, at least partly, along fiber tracts. Intraaxonal movement of bacteria probably is a mechanism involved in the pathogenesis of this disease.