The determination of the maximum acceptable charge power and power output is of special significance in the development of hybrid electric vehicles. Theoretically, the maximum acceptable charge power and the power output can be defined as those relating to the maximum current levels before the occurrence of any side reaction. A new method has been developed to measure these maximum currents for nickel/metal hydride batteries used in hybrid electric vehicles. The method involves three step: (i) measurement of the transient voltage vs. current relation during charge or discharge by a sequence of pulse currents; (ii) calculation of the overall battery internal impedance at different times and current magnitudes; (iii) determination of the maximum current from the minimum point of the internal impedance. This method is based on the principle that, with increasing current level, mass transport becomes the rate-limiting step. Any extra increase in current can only cause the occurrence of a side reaction which will result in an increase in the battery internal impedance. The maximum current can thus be determined by the minimum internal impedance from a plot of this parameter against current. Experimental results show that the maximum current strongly depends on battery state-of-charge and also, battery structure. Increase in the surface area of the battery plates is an efficient way to increase the charge-acceptance and power output of the battery, and also to reduce the internal impedance.