Toward understanding topographically specific branching of retinal axons in their target area, we have studied the interaction between neurotrophin receptors and members of the Eph family. TrkB and its ligand BDNF are uniformly expressed in the retina and tectum, respectively, and exert a branch-promoting activity, whereas EphAs and ephrinAs are expressed in gradients in retina and tectum and can mediate a suppression of axonal branching. We have identified a novel cis interaction between ephrinA5 and TrkB on retinal ganglion cell axons. TrkB interacts with ephrinA5 via its second cysteine-rich domain (CC2), which is necessary and sufficient for binding to ephrinA5. Their functional interaction is twofold: ephrinA5 augments BDNF-promoted retinal axon branching in the absence of its activator EphA7-Fc, whereas EphA7-Fc application abolishes branching in a local and concentration-dependent manner. The importance of TrkB in this process is shown by the fact that overexpression of an isolated TrkB-CC2 domain interfering with the ephrinA/TrkB interaction abolishes this regulatory interplay, whereas knockdown of TrkB via RNA interference diminishes the ephrinA5-evoked increase in branching. The ephrinA/Trk interaction is neurotrophin induced and specifically augments the PI-3 kinase/Akt pathway generally known to be involved in the promotion of branching. In addition, ephrinAs/TrkB modulate axon branching and also synapse formation of hippocampal neurons. Our findings uncover molecular mechanisms of how spatially restricted axon branching can be achieved by linking globally expressed branch-promoting with differentially expressed branch-suppressing activities. In addition, our data suggest that growth factors and the EphA-ephrinA system interact in a way that affects axon branching and synapse development.