To characterize the morphology of the endoneurial microvasculature of degenerating nerves under hyperglycemia, the morphology of endoneurial microvessels in transected sciatic nerves was examined in normal and streptozotocin-induced diabetic rats. Three months after transection, the fascicular area and median vascular luminal area at the proximal level of the distal stump were significantly larger in diabetic than in control animals, whereas the number of vessels per fascicle was the same in the two groups. Arterioles in various stages of development were found in the centrifascicular region in some transected nerves. Serial sections revealed that these vessels originated from transperineural arterioles. The frequency and magnitude of vascular wall thickening were both greater in diabetic rats. These results suggest that the endoneurial microvasculature responds abnormally to nerve injury under hyperglycemia.