The hyperpolarization‐activated current (I_h) is an inward current activated by hyperpolarization from the resting potential and is an important modulator of action potential firing frequency in many excitable cells. Four hyperpolarization‐activated, cyclic nucleotide‐modulated subunits, HCN1–4, can form I_h ion channels. In the present study we investigated the function of I_h in primary somatosensory neurons. Neuronal firing in response to current injection was promoted by elevating intracellular cAMP levels and inhibited by blockers of I_h, suggesting that I_h plays a critical role in modulating firing frequency. The properties of I_h in three size classes of sensory neurons were next investigated. In large neurons I_h was fast activating and insensitive to elevations in cAMP, consistent with expression of HCN1. I_h was ablated in most large neurons in HCN1^−/− mice. In small neurons a slower activating, cAMP‐sensitive I_h was observed, as expected for expression of HCN2 and/or HCN4. Consistent with this, I_h in small neurons was unchanged in HCN1^−/− mice. In a neuropathic pain model HCN1^−/− mice exhibited substantially less cold allodynia than wild‐type littermates, suggesting an important role for HCN1 in neuropathic pain. This work shows that I_h is an important modulator of action potential generation in somatosensory neurons.