An experimental study was performed to investigate the influence of subsidence of chronic inflammation in peripheral target tissue on the recovery of crushed nerve. Seventy-eight male Wistar rats weighing 300–370 g were used. The sciatic nerve was operatively crushed unilaterally with an aneurysm clip (250 gf) applied for 5 min. Chronic inflammation, localized to the ankle, was induced by intra-articular injection of complete Freund's adjuvant 1 week preoperatively. Prednisolone farnesylate (PNF-21) 1.4% gel was applied on the ankle as an anti-inflammatory agent for consecutive days after the operation. The animals were divided into five groups as follows: crush injury with ipsilateral arthritis (CIA); crush injury with ipsilateral arthritis and PNF-21 gel applied on the ipsilateral ankle (CIA+IPNF); crush injury with ipsilateral arthritis and PNF-21 gel applied on the contralateral ankle (CIA+CPNF); crush injury with contralateral arthritis (CCA); crush injury without arthritis (C). Specimens for histopathological examination were taken from the nerve at a site 5 mm distal to the crush lesion at 4 weeks postoperatively. The average axon diameter was significantly larger in the CIA+IPNF group than in the CIA group (p<0.01). No significant difference was observed between the CIA+CPNF group and the CIA group. In conclusion, chronic inflammation in peripheral target tissue suppresses recovery of the crushed nerve, and subsidence of this chronic inflammation improves this suppression histopathologically.