A nerve is an enclosed, cable-like bundle of nerve fibers (called axons). Nerves have historically been considered the basic units of the peripheral nervous system. A nerve provides a common pathway for the electrochemical nerve impulses called action potentials that are transmitted along each of the axons to peripheral organs or, in the case of sensory nerves, from the periphery back to the central nervous system. Each axon is an extension of an individual neuron, along with other supportive cells such as some Schwann cells that coat the axons in myelin.

Each axon is surrounded by a layer of connective tissue called the endoneurium. The axons are bundled together into groups called fascicles, and each fascicle is wrapped in a layer of connective tissue called the perineurium. The entire nerve is wrapped in a layer of connective tissue called the epineurium. Nerve cells (often called neurons) are further classified as either sensory or motor.

In the central nervous system, the analogous structures are known as nerve tracts.

Each nerve is covered on the outside by a dense sheath of connective tissue, the epineurium. Beneath this is a layer of fat cells, the perineurium, which forms a complete sleeve around a bundle of axons. Perineurial septa extend into the nerve and subdivide it into several bundles of fibres. Surrounding each such fibre is the endoneurium. This forms an unbroken tube from the surface of the spinal cord to the level where the axon synapses with its muscle fibres, or ends in sensory receptors. The endoneurium consists of an inner sleeve of material called the glycocalyx and an outer delicate meshwork of collagen fibres. Nerves are bundled and often travel along with blood vessels, since the neurons of a nerve have fairly high energy requirements.

Within the endoneurium, the individual nerve fibres are surrounded by a low-protein liquid called endoneurial fluid. This acts in a similar way to the cerebrospinal fluid in the central nervous system and constitutes a blood-nerve barrier similar to the blood–brain barrier. Molecules are thereby prevented from crossing the blood into the endoneurial fluid. During the development of nerve edema from nerve irritation (or injury), the amount of endoneurial fluid may increase at the site of irritation. This increase in fluid can be visualized using magnetic resonance (MR) neurography, and thus MR neurography can identify nerve irritation and/or injury.

Nerves are categorized into three groups based on the direction that signals are conducted:

Nerves can be categorized into two groups based on where they connect to the central nervous system:

Specific terms are used to describe nerves and their actions. A nerve that supplies information to the brain from an area of the body, or controls an action of the body is said to innervate that section of the body or organ. Other terms relate to whether the nerve affects the same side ("ipsilateral") or opposite side ("contralateral") of the body, to the part of the brain that supplies it.