We propose that locally high concentrations of new ultrafine aerosols may be generated within lightning channels, in which the air is initially highly ionized by discharge currents. In the channel, temperatures are sufficiently elevated to ensure that preexisting condensed materials are vaporized, generating aerosol precursors at concentrations much higher than would be found in ambient air. As the channel expands and cools, ions that survive neutralization attract condensable vapors and grow rapidly. Detailed microphysical simulations indicate that ultrafine particles (>3 nm in diameter) may achieve concentrations of 105--106/cm3 in the channel within 10 seconds after a flash, leading to an effective production index of 1013--1014 particles per meter of channel. While lightning may generate very high local concentrations of ultrafine particles, and occur worldwide, the overall contribution to global aerosol production is estimated to be small. ¿ 2001 American Geophysical Union