Limb lengthening of the upper extremity using external fixation devices is associated with a high risk of neurovascular impairment. To aid early detection of nerve injury, intraoperative monitoring of neural function was performed in five patients undergoing Ilizarov-type circular external-fixator application. The apparatus was applied to the humerus in two cases and to the forearm in the other three cases. The function of ulnar, median, and radial nerves was assessed continuously throughout the surgery by using sensory-evoked potential (SEP) monitoring technique. The responses were elicited by stimulation of these nerves in the distal forearm with recording at Erb's point and over the anterior cervical spine. During apparatus application, radial-response attenuation was identified in two instances. No corrective actions were performed in one case, and the patient had symptoms of radial nerve deficit postoperatively. In the other case, prompt removal of the offending half-pin after the detection of electrophysiologic abnormalities resulted in subsequent response restoration and the avoidance of postoperative nerve dysfunction. Sensory-evoked potential monitoring proved to be a reliable indicator of nerve compromise during external fixation of upper extremities and may be considered a valuable surgical adjunct.