Encainide is a benzanilide derivative that is effective against ventricular arrhythmias but, at times, may be arrhythmogenic. The microelectrode technique of intracellular current application and transmembrane voltage recording was used to study the effects of encainide, in a concentration equivalent to a clinically effective antiarrhythmic plasma level, on the determinants of cardiac excitability in sheep Purkinje fibers. A rapid, on-line computerized data analysis system was used to track the alterations in the active and passive membrane properties relevant to excitability in time. Cardiac excitability was defined experimentally in terms of the current required to attain threshold and/or the shift in strength- or change-duration curves. Encainide produced multiphasic changes in cardiac excitability, the final state of excitability depended on the balance between altered passive and active membrane properties. Encainide could enhance excitability by increasing membrane and slope resistance without altering the nonlinearities of the current-voltage relationship despite an actual depression of the sodium system. Encainide could decrease excitability by 1) depressing the sodium system; 2) decreasing membrane resistance without altering the nonlinearities of the subthreshold current-voltage relationship; 3) altering the nonlinearities of the current-voltage relationship; and 4) by a combination of these actions. During washout, excitability could remain altered despite a return of descriptive parameters such as the maximal rate of rise of phase 0, overshoot and action potential duration to normal. The study demonstrated the importance of time-related changes of an antiarrhythmic drug at a constant concentration. The results explain, in part, the antiarrhythmic actions and arrhythmogenic potential of encainide.