The action of gadolinium (Gd3+) on ion currents in myelinated axons of Xenopus laevis was investigated with the voltage clamp technique. The analysis revealed the following effects. (i) The potential-dependent parameters of both Na and K channels were shifted. The shift was equally large for activation, inactivation, and activation time constant curves (+9 mV for 100 microM Gd3+). The effects could be explained by screening of fixed surface charges at a density of -1.2 e nm-2. (ii) The rate of gating for both Na and K channels was reduced more than predicted from the shift. This effect could be quantified as a scaling (by a factor 3 and 5 respectively at 100 microM Gd3+) of the activation time constant curves. (iii) An activation- and inactivation-independent block of both Na and K channels, obeying 1:1 stoichiometry with a Kd value of about 70 microM potential-independent block of leakage current, obeying 1:2 stoichiometry with a Kd value of 600 microM. (iv) The analysis suggests separate binding sites for the effects, comprising high affinity modulatory and blocking sites on the channel proteins and low affinity receptors on phospholipids, associated with the effect on the leakage current.