The present study was designed to compare regenerative potential of normal and degenerated nerve grafts. Peripheral nerves in rats were induced to undergo in situ degeneration for a period of 6 weeks, 3, 6 and 12 months. During early phase of denervation the myelin and axons degenerated and were absorbed. With prolonged denervation (i.e. 12 months), such nerves were reduced in size and exhibited extensive fibrosis. A 2 cm long segment of the degenerated nerve was transplanted in an surgically created gap in the host peroneal nerve to evaluate their regeneration supporting ability. Regeneration of host axons occurred rapidly through nerves degenerated for a period up to 3 months. The extent of regeneration was compromised in 6-month degenerated nerve group, and was significantly reduced in the 12-month degenerated nerve grafts. These results show that with extended degeneration interval, the regeneration supporting ability of nerves is compromised. It is concluded that nerve repair should not be excessively delayed in order to compromise recovery.