Acute damage to axons is manifested as a breach in their membranes, ion exchange across the compromised region, local depolarization, and sometimes conduction block. This condition can worsen leading to axotomy. Using a novel recording chamber, we demonstrate immediate arrest of this process by application of polyethylene glycol (PEG) to a severe compression of guinea pig spinal cord. Variable magnitudes of compound actions potentials (CAPs) were rapidly restored in 100% of the PEG-treated spinal cords. Using a dye exclusion test, in which horseradish peroxidase is imbibed by damaged axons, we have shown that the physiological recovery produced by polyethylene glycol was associated with sealing of compromised axolemmas. Injured axons readily imbibe horseradish peroxidase-but not following sealing of their membranes. The density of nerve fibers taking up the marker is significantly reduced following polyethylene glycol treatment compared to a control group. We further show that all axons-independent of their caliber-are equally susceptible to the compression injury and equally susceptible to polyethylene glycol mediated repair. Thus, polyethylene glycol-induced reversal of permeabilization by rapid membrane sealing is likely the basis for physiological recovery in crushed spinal cords. We discuss the clinical importance of these findings.