A portable multi-channel telemetry system which can be used for brain stimulation and neuronal activity recording in freely behaving small animals is described here. This system consists of three major components of headstage, backpack and portable Personal Digital Assistant (PDA). The headstage contains high precision instrument amplifiers with high input impedance. The backpack is comprised of two parts: (1) a main board (size: 36 mm x 22 mm x 3.5 mm and weight: 40 g with batteries, 20 g without), with current/voltage stimulator and special circuit suitable for neuronal activity recording and (2) and a bluetooth transceiver, with a high data transmission rate up to 70 kb/s, suitable for downloading stimulation commands and uploading acquired data. We recorded neuronal activities of the primary motor area of a freely behaving rat with 12-bit resolution at 12 k samples/s. The recorded data and analysis results showed that the system was successful by comparing with the commercial equipment Cerebus 128-Channel Data Acquisition System (Cyberkinetics Inc.). Using the PDA, we can control stimulation and recording. It provides a flexible method to do some research work in the circumstances where other approaches would be difficult or impossible.