The structural basis of cortical columns are radially oriented axon collaterals that form precise connections between distinct cortical layers. During development, these connections are highly specified from the initial outgrowth of collateral branches. Our previous work provided evidence for positional cues confined to individual layers that induce and/or prevent the formation of axon collaterals in specific populations of cortical neurons. Here we demonstrated with in situ hybridization techniques that mRNA of the Eph receptor tyrosine kinase EphA5 and one of its ligands, ephrin-A5, are present in distinct cortical layers, at a time when intrinsic connections are being formed in the cortex. Axonal guidance assays indicate that ephrin-A5 is a repellent signal for a populations of axons that in vivo avoid the cortical layer expressing ephrin-A5. In contrast to its established role as a repulsive axonal guidance signal, ephrin-A5 specifically mediates sprouting of those cortical axons that target the ephrin-A5-expressing layer in vivo. These results identify a novel function of ephrin-A5 on axonal arbor formation. The laminar distribution and the dual action on specific populations of axons suggest that ephrin-A5 plays a role in the assembly of local cortical circuits.