The epineurial sleeve technique for nerve repair is designed in part to protect a healing nerve from external humoral influences, but research suggests that the external factor dehydroepiandrosterone (DHEA) may actually improve nerve healing in crush injuries. To test the effect of DHEA, we injected it into the epineurial chambers created to repair transected rat sciatic nerves. In 18 control rats, the nerve was transected and repaired without DHEA treatment. Eighteen animals received subepineurial injections of propylene glycol vehicle, and 18 received subepineurial injections of about 0.2 ml DHEA. Walking-track analysis and toe-contracture measurements showed no significant differences among the three groups. At 12 weeks, the gastrocnemius muscles in the DHEA group were significantly heavier than those of untreated controls. At 6 and 12 weeks, DHEA-treated nerves had significantly more myelinated axons, larger average fiber diameter, and greater axonal cross-sectional areas in the proximal, middle, and distal sections. Myelin thickness did not differ between groups, except at 6 weeks between the DHEA and vehicle-treated groups. We conclude that subepineurial dehydroepiandrosterone treatment reduced the extent of denervation atrophy and induced an earlier onset of axonal regeneration.