Axons are thought to be ultrathin membrane cables of a relatively uniform diameter, designed to conduct electrical signals, or action potentials. Here, we demonstrate that unmyelinated axons are not simple cylindrical tubes. Rather, axons have nanoscopic boutons repeatedly along their length interspersed with a thin cable with a diameter of ∼60 nm like pearls-on-a-string. These boutons are only ∼200 nm in diameter and do not have synaptic contacts or a cluster of synaptic vesicles, hence non-synaptic. Our in silico modeling suggests that axon pearling can be explained by the mechanical properties of the membrane including the bending modulus and tension. Consistent with modeling predictions, treatments that disrupt these parameters like hyper- or hypo-tonic solutions, cholesterol removal, and non-muscle myosin II inhibition all alter the degree of axon pearling, suggesting that axon morphology is indeed determined by the membrane mechanics. Intriguingly, neuronal activity modulates the cholesterol level of plasma membrane, leading to shrinkage of axon pearls. Consequently, the conduction velocity of action potentials becomes slower. These data reveal that biophysical forces dictate axon morphology and function and that modulation of membrane mechanics likely underlies plasticity of unmyelinated axons.