Failure of nerve repair or poor functional outcome after reconstruction can be influenced by various causes. Besides improper microsurgical technique, fascicular malalignment and unphysiologic tension, we found in our clinical series that a subclinical nerve compression distal to the repair site can seriously impair regeneration. We concluded that the injured nerve, whether from trauma or microsurgical intervention, could be more susceptible to distal entrapment in the regenerative stage because of its disturbed microcirculation, swelling and the increase of regenerating axons followed by increased nerve volume. In two cases we found the regenerating nerve entrapped at pre-existing anatomical sites of narrowing resulting in impaired functional recovery. In both cases the surgical therapy was decompression of the distal entrapped nerve and this was followed by continued regeneration. Thorough clinical and electrophysiologic follow-up is necessary to detect such adverse compression effects and to distinguish between the various causes of failed regeneration. Under certain circumstances primary preventive decompression may be beneficial if performed at the time of nerve coaptation.