<p>Cephalopod molluscs are among the most behaviorally and neurologically complex invertebrates. As they are now included in research animal welfare regulations in many countries, humane and effective anesthesia is required during invasive procedures. However, currently there is no evidence that agents believed to act as anesthetics produce effects beyond immobility. In this study we demonstrate, for the first time, that two of the most commonly used agents in cephalopod general anesthesia, magnesium chloride and ethanol, are capable of producing strong and reversible blockade of afferent and efferent neural signal; thus they are genuine anesthetics, rather than simply sedating agents that render animals immobile but not insensible. Additionally, we demonstrate that injected magnesium chloride and lidocaine are effective local anesthetic agents. This represents a considerable advance for cephalopod welfare. Using a reversible, minimally invasive recording procedure, we measured activity in the pallial nerve of cuttlefish (Sepia bandensis) and octopus (Abdopus aculeatus, Octopus bocki), during induction and reversal for five putative general anesthetic and two local anesthetic agents. We describe the temporal relationship between loss of behavioral responses (immobility), loss of efferent neural signal (loss of “consciousness”) and loss of afferent neural signal (anesthesia) for general anesthesia, and loss of afferent signal for local anesthesia. Both ethanol and magnesium chloride were effective as bath-applied general anesthetics, causing immobility, complete loss of behavioral responsiveness and complete loss of afferent and efferent neural signal. Cold seawater, diethyl ether, and MS-222 (tricaine) were ineffective. Subcutaneous injection of either lidocaine or magnesium chloride blocked behavioral and neural responses to pinch in the injected area, and we conclude that both are effective local anesthetic agents for cephalopods. Lastly, we demonstrate that a standard euthanasia protocol—immersion in isotonic magnesium chloride followed by surgical decerebration—produced no behavioral response and no neural activity during surgical euthanasia. Based on these data, we conclude that both magnesium chloride and ethanol can function as general anesthetic agents, and lidocaine and magnesium chloride can function as local anesthetic agents for cephalopod molluscs.</p>