Mitochondria carry out many of the processes implicated in maintaining axon health or causing axon degeneration, including ATP and reactive oxygen species (ROS) generation, as well as calcium buffering and protease activation. Defects in mitochondrial function and transport are common in axon degeneration, but how changes in specific mitochondrial properties relate to degeneration is not well understood. Using cutaneous sensory neurons of living larval zebrafish as a model, we examined the role of mitochondria in axon degeneration by monitoring mitochondrial morphology, transport, and redox state before and after laser axotomy. Mitochondrial transport terminated locally after injury in wild-type axons, an effect that was moderately attenuated by expressing the axon-protective fusion protein Wallerian degeneration slow (WldS). However, mitochondrial transport arrest eventually occurred in WldS-protected axons, indicating that later in the lag phase, mitochondrial transport is not required for axon protection. By contrast, the redox-sensitive biosensor roGFP2 was rapidly oxidized in the mitochondrial matrix after injury, and WldS expression prevented this effect, suggesting that stabilization of ROS production may mediate axon protection. Overexpression of PGC-1α, a transcriptional coactivator with roles in both mitochondrial biogenesis and ROS detoxification, dramatically increased mitochondrial density, attenuated roGFP2 oxidation, and delayed Wallerian degeneration. Collectively, these results indicate that mitochondrial oxidation state is a more reliable indicator of axon vulnerability to degeneration than mitochondrial motility.