beta-Amyloid precursor protein (betaPP) can reside at neuron and glial cell surfaces or undergo proteolytic processing into secreted fragments. Although betaPP has been studied extensively, its precise physiological role is unknown. A line of transgenic knock-out mice selectively deficient in betaPP survive and breed but exhibit motor dysfunction and brain gliosis, consistent with a physiological role for betaPP in neuron development. To elucidate these functions, we cultured hippocampal neurons from wild-type and betaPP-deficient mice and compared their ability to attach, survive, and develop neurites. We found that hippocampal neurons from betaPP-deficient mice had diminished viability and retarded neurite development. We also compared the effects of betaPP secretory products, released from wild-type astrocytes, on process outgrowth from wild-type and betaPP-deficient hippocampal neurons. Outgrowth was enhanced at 1 d in the presence of wild-type astrocytes, as compared with betaPP-deficient astrocytes. However, by 3 d, neurons had shorter axons but more minor processes with more branching when cocultured with wild-type astrocytes, as compared with betaPP-deficient astrocytes. Our data demonstrate that cell-associated neuronal betaPP contributes to neuron viability, axonogenesis, and arborization and that betaPP secretory products modulate axon growth, dendrite branching, and dendrite numbers.