Objective. The initiation of an action potential by extracellular stimulation occurs after local depolarization of the neuronal membrane above threshold. Although the technique shows remarkable clinical success, the site of action and the relevant stimulation parameters are not completely understood. Approach. Here we identify the site of action potential initiation in rabbit retinal ganglion cells (RGCs) interfaced to an array of extracellular capacitive stimulation electrodes. We determine which feature of the extracellular potential governs action potential initiation by simultaneous stimulation and recording RGCs interfaced in epiretinal configuration. Stimulation electrodes were combined to areas of different size and were presented at different positions with respect to the RGC. Main results. Based on stimulation by electrodes beneath the RGC soma and simultaneous sub-millisecond latency measurement we infer axonal initiation at the site of maximal curvature of the extracellular potential. Stimulation by electrodes at different positions along the axon reveals a nearly constant threshold current density except for a narrow region close to the cell soma. These findings are explained by the concept of the activating function modified to consider a region of lower excitability close to the cell soma. Significance. We present a framework how to estimate the site of action potential initiation and the stimulus required to cross threshold in neurons tightly interfaced to capacitive stimulation electrodes. Our results underscore the necessity of rigorous electrical characterization of the stimulation electrodes and of the interfaced neural tissue.