Locating circuit neurons and recording from them with single-cell resolution is a prerequisite for studying neural circuits. Determining neuron location can be challenging even in small nervous systems because neurons are densely packed, found in different layers, and are often covered by ganglion and nerve sheaths that impede access for recording electrodes and neuronal markers. We revisited the voltage-sensitive dye RH795 for its ability to stain and record neurons through the ganglion sheath. Bath-application of RH795 stained neuronal membranes in cricket, earthworm and crab ganglia without removing the ganglion sheath, revealing neuron cell body locations in different ganglion layers. Using the pyloric and gastric mill central pattern generating neurons in the stomatogastric ganglion (STG) of the crab, Cancer borealis, we found that RH795 permeated the ganglion without major residue in the sheath and brightly stained somatic, axonal and dendritic membranes. Visibility improved significantly in comparison to unstained ganglia, allowing the identification of somata location and number of most STG neurons. RH795 also stained axons and varicosities in non-desheathed nerves, and it revealed the location of sensory cell bodies in peripheral nerves. Importantly, the spike activity of the sensory neuron AGR, which influences the STG motor patterns, remained unaffected by RH795, while desheathing caused significant changes in AGR activity. With respect to recording neural activity, RH795 allowed us to optically record membrane potential changes of sub-sheath neuronal membranes without impairing sensory activity. The signal-to-noise ratio was comparable with that previously observed in desheathed preparations and sufficiently high to identify neurons in single-sweep recordings and synaptic events after spike-triggered averaging. In conclusion, RH795 enabled staining and optical recording of neurons through the ganglion sheath and is therefore both a good anatomical marker for living neural tissue and a promising tool for studying neural activity of an entire network with single-cell resolution.