Thin, unmyelinated axons densely populate the mammalian hippocampus and cortex. However, the location and dynamics of spike initiation in thin axons remain unclear. We investigated basic properties of spike initiation and propagation in CA3 neurons of juvenile rat hippocampus. Sodium channel alpha subunit distribution and local applications of tetrodotoxin demonstrate that the site of first threshold crossing in CA3 neurons is ∼35 μm distal to the soma, somewhat more proximal than our previous estimates. This discrepancy can be explained by the finding, obtained with simultaneous whole cell somatic and extracellular axonal recordings, that a zone of axon stretching to ∼100 μm distal to the soma reaches a maximum rate of depolarization nearly synchronously by the influx of sodium from the high-density channels. Models of the proximal axon incorporating observed distributions of sodium channel staining recapitulated salient features of somatic and axonal spike waveforms, including the predicted initiation zone, characteristic spike latencies, and conduction velocity. The preferred initiation zone was unaltered by stimulus strength or repetitive spiking, but repetitive spiking increased threshold and significantly slowed initial segment recruitment time and conduction velocity. Our work defines the dynamics of initiation and propagation in hippocampal principal cell axons and may help reconcile recent controversies over initiation site in other axons.