Nervous system morphogenesis is characterized by extensive interactions between individual axon growth cones and their cellular environments. Selective cell adhesion is one mechanism by which the growth of an axon can be modulated, and members of the classic cadherin group of cell adhesion molecules have been shown to play a role in this process in both vertebrates and Drosophila. In Drosophila, there are two classic cadherins: one involved primarily in regulating the morphogenesis of epithelia, and the other, DN-cadherin, required almost exclusively in neuronal development. In contrast, C. elegans has a single classic cadherin gene, hmr-1, whose function is required for epithelial morphogenesis. We show here that hmr-1 also encodes a second classic cadherin via a novel mechanism involving an alternative, neuron-specific promoter, coupled with alternative splicing. This novel HMR-1 isoform is very similar to DN-cadherin, and a mutant strain that specifically lacks the function of this isoform displays defects in the fasciculation and outgrowth of a subset of motor neuron processes; a phenotype that resembles loss of DN-cadherin function in Drosophila. These results indicate that Drosophila and C. elegans share a conserved, cadherin-dependent mechanism involved in regulating axonal patterning and fasciculation.