Mutations in the gene encoding the K⁺ channel KCNQ2 cause neonatal epilepsy and myokymia, indicating that KCNQ2 regulates the excitability of CNS neurons and motor axons, respectively. We show here that KCNQ2 channels are functional components of axon initial segments and nodes of Ranvier, colocalizing with ankyrin-G and voltage-dependent Na⁺ channels throughout the CNS and PNS. Retigabine, which opens KCNQ channels, diminishes axonal excitability. Linopirdine, which blocks KCNQ channels, prolongs the repolarization of the action potential in neonatal nerves. The clustering of KCNQ2 at nodes and initial segments lags that of ankyrin-G during development, and both ankyrin-G and KCNQ2 can be coimmunoprecipitated in the brain. KCNQ3 is also a component of some initial segments and nodes in the brain. The diminished activity of mutant KCNQ2 channels accounts for neonatal epilepsy and myokymia; the cellular locus of these effects may be axonal initial segments and nodes.