A focal demyelinative lesion of peripheral nerve was produced by intraneural injection of either antiserum from rabbits with experimental allergic neuritis or experimental allergic encephalomyelitis or antiserum to galactocerebroside. We studied the relationship between clinical and electrophysiological recovery from this lesion and the morphological pattern of remyelination. Foot muscles on the the injected side weakened within an hour of injection and remained paralyzed for 7 days; strength gradually returned to normal by 16 days after injection. Electrophysiological conduction block, apparent within a few hours of injection, persisted for about 7 days. At 8 days we detected dispersed, very low amplitude muscle action potentials with long latency. Morphologically, demyelinated axons were surrounded by Schwann cells at 7 days after injection, but compacted myelin was not present. After 8 days, remyelinating axons became surrounded by thickening compacted myelin. The time of onset of remyelination and the rate of remyelination up to 14 days following the injection were independent of axon size. The onset of clinical and electrophysiological recovery from the lesion corresponded to the appearance of 2 to 8 myelin lamellae around each remyelinating axon. At 37 days after injection, when conduction velocities had returned to preinjection values, myelin thickness of remyelinating fibers had increased to approximately one-third that of control nerves.