Schwann cells (SCs) that cap neuromuscular junctions (nmjs) play roles in guiding nerve terminal growth in paralyzed and partially denervated muscles; however, the role of these cells in the day-to-day maintenance of this synapse is obscure. Neuregulins, alternatively spliced ligands for several erbB receptor tyrosine kinases, are thought to play important roles in cell-cell communication at the nmj, affecting synapse-specific gene expression in muscle fibers and the survival of terminal SCs during development. Here we show that application of a soluble neuregulin isoform, glial growth factor II (GGF2), to developing rat muscles alters terminal SCs, nerve terminals, and muscle fibers. SCs extend processes and migrate from the synapse. Nerve terminals retract from acetylcholine receptor-rich synaptic sites, and their axons grow, in association with SCs, to the ends of the muscle. These axons make effective synapses only after withdrawal of GGF2. These synaptic alterations appear to be induced by the actions of neuregulin on SCs, because SC transplants growing into contact with synaptic sites also caused withdrawal of nerve terminal branches. These results show that SCs can alter synaptic structure at the nmj and implicate these cells in the maintenance of this synapse.