A new method for in vivo neural activation using low-intensity, pulsed infrared light exhibits advantages over standard electrical means by providing contact-free, spatially selective, artifact-free stimulation. Here we investigate the biophysical mechanism underlying this phenomenon by careful examination of possible photobiological effects after absorption-driven light-tissue interaction. The rat sciatic nerve preparation was stimulated in vivo with a Holmium:yttrium aluminum garnet laser (2.12 microm), free electron laser (2.1 microm), alexandrite laser (750 nm), and prototype solid-state laser nerve stimulator (1.87 microm). We systematically determined relative contributions from a list of plausible interaction types resulting in optical stimulation, including thermal, pressure, electric field, and photochemical effects. Collectively, the results support our hypothesis that direct neural activation with pulsed laser light is induced by a thermal transient. We then present data that characterize and quantify the spatial and temporal nature of this required temperature rise, including a measured surface temperature change required for stimulation of the peripheral nerve (6 degrees C-10 degrees C). This interaction is a photothermal effect from moderate, transient tissue heating, a temporally and spatially mediated temperature gradient at the axon level (3.8 degrees C-6.4 degrees C), resulting in direct or indirect activation of transmembrane ion channels causing action potential generation.