The molecular determinants of abnormal propagation of action potentials along axons and ectopic conductance in demyelinating diseases of the central nervous system, like multiple sclerosis (MS), are poorly defined. Widespread interruption of myelin occurs in several mouse models of demyelination, rendering them useful for research. Herein, considerable myelin loss is shown in the optic nerves of cuprizone-treated demyelinating mice. Immuno-fluorescence confocal analysis of the expression and distribution of voltage-activated K⁺ channels (K(V)1.1 and 1.2 α subunits) revealed their spread from typical juxta-paranodal (JXP) sites to nodes in demyelinated axons, albeit with a disproportionate increase in the level of K(V)1.1 subunit. Functionally, in contrast to monophasic compound action potentials (CAPs) recorded in controls, responses derived from optic nerves of cuprizone-treated mice displayed initial synchronous waveform followed by a dispersed component. Partial restoration of CAPs by broad spectrum (4-aminopyridine) or K(V)1.1-subunit selective (dendrotoxin K) blockers of K⁺ currents suggest enhanced K(V)1.1-mediated conductance in the demyelinated optic nerve. Biophysical profiling of K⁺ currents mediated by recombinant channels comprised of different K(V)1.1 and 1.2 stoichiometries revealed that the enrichment of K(V)1 channels K(V)1.1 subunit endows a decrease in the voltage threshold and accelerates the activation kinetics. Together with the morphometric data, these findings provide important clues to a molecular basis for temporal dispersion of CAPs and reduced excitability of demyelinated optic nerves, which could be of potential relevance to the patho-physiology of MS and related disorders.