This study presents a two-dimensional finite element model of the electrode-electrolyte-skin system which takes into account the nonlinear behavior of the skin with respect to the amplitude of the voltage. The nonlinear modeling approach has practical value for studies related to transcutaneous stimulation (e.g. maximizing the dynamic range of sensory substitution systems, optimization of TENS, optimization of transcutaneous cardiac pacing, etc.). The model has three main regions: 1) the electrolyte; 2) the skin; and 3) the body. The model consists of 364 nodes, 690 elements and was generated on a MacIntosh II using a version of FEHT (Finite Element for Heat Transfer) adapted for electromagnetics. The electrodes are equipotential lines and the electrolyte is modeled as a pure resistive region with constant conductivity. Although the electrode-electrolyte interface can introduce nonlinearities, we did not take them into account because the skin displays a much higher impedance. The skin is modeled as a nonlinear material with the conductivity dependent on the applied voltage. To account for the mosaic structure of the skin, we used ten different nonlinear subregions of five different values of breakdown voltage. The region designated "body" models the effects of the resistance associated with the dermis and the tissues underneath the skin, and has a constant high conductivity. We studied the effects of two different electrolytes on the comfort of stimulation and found that there was less potential pain delivered when high-resistivity electrolytes were used. This was due to the larger nonuniformities in the current density distribution which appeared for low-resistivity electrolytes.(ABSTRACT TRUNCATED AT 250 WORDS)