The purpose of this study was to evaluate the usefulness of short segment stimulation (SSS) of the peroneal nerve at the knee in order to localize the site of compression and/or entrapment of the nerve. Eighteen patients with suspected peroneal nerve palsy and 28 controls were studied by SSS of the peroneal nerve across the knee. Compound muscle action potentials (CMAPs) were obtained from the extensor digitorum brevis muscle after successive supramaximal stimuli of the nerve at 2 cm intervals, starting 4 cm distal (D4 and D2) and ending 6 cm proximal (P2, P4, and P6) to the fibular head prominence (P). In patients the average conduction times from D2 to P, P to P2, and P2 to P4 were significantly (P less than 0.05) longer and the average amplitude of CMAPs at P, P2, P4, and P6 significantly (P less than 0.05) lower than those of controls. Fourteen patients showed statistically significant reduction in amplitude and prolongation of conduction time in one or more short segments. Three patients had prolongation of conduction time only and one patient had reduction in amplitude only. When nerve conduction of the entire 10-cm segment across the knee was tested by the conventional method, only nine showed reduction in amplitude from proximal stimulation, or slowing of motor conduction velocity across the 10-cm segment or both. It was concluded that the SSS technique is a sensitive and reliable procedure for the detection of mild compression or entrapment of the peroneal nerve around the knee.