The use of advanced in vitro testing is a powerful tool to develop predictive cellular assays suitable for improving the high attrition rates of novel pharmaceutical compounds. A microscale, organotypic model of nerve tissue with physiological measures that mimic clinical nerve compound action potential (CAP) and nerve fiber density (NFD) tests may be more predictive of clinical outcomes, enabling a more cost-effective approach for selecting promising lead compounds with higher chances of late-stage success. However, the neurological architecture, physiology, and surrounding extracellular matrix are hard to mimic in vitro. Using a dual hydrogel construct and explants from rat embryonic dorsal root ganglia, the present study describes an in vitro method for electrophysiological recording of intra- and extra-cellular recordings using a spatially-controlled, microengineered sensory neural fiber tract. Specifically, these 3D neural cultures exhibit both structural and functional characteristics that closely mimic those of afferent sensory peripheral fibers found in vivo. Our dual hydrogel system spatially confines growth to geometries resembling nerve fiber tracts, allowing for a high density of parallel, fasciculated neural growth. Perhaps more importantly, outputs resembling clinically relevant test criteria, including the measurement of CAP and NFD are possible through our advanced model. Moreover, the 3D hydrogel constructs allow flexibility in incorporated cell type, geometric fabrication, and electrical manipulation, providing a viable assay for systematic culture, perturbation, and testing of biomimetic neural growth for mechanistic studies necessitating physiologically-relevant readouts.