While a b-sheet-rich form of the prion protein (PrP Sc ) causes neurodegeneration, the biological activity of its precursor, the cellular prion protein (PrP C ), has been elusive. We have studied the effect of purified recombinant prion protein (recPrP) on rat fetal hippocampal neurons in culture. Overnight exposure to Syrian hamster or mouse recPrP, folded into an a-helical-rich conformation similar to that of PrP C , resulted in a 1.9-fold increase in neurons with a differentiated axon, a 13.5-fold increase in neurons with differentiated dendrites, a fivefold increase in axon length, and the formation of extensive neuronal circuitry. Formation of synaptic-like contacts was increased by a factor of 4.6 after exposure to recPrP for 7 days. Neither the N-terminal nor C-terminal domains of recPrP nor the PrP paralogue doppel (Dpl) enhanced the polarization of neurons. Inhibitors of protein kinase C (PKC) and of Src kinases, including p59Fyn, blocked the effect of recPrP on axon elongation, while inhibitors of phosphatidylinositol 3-kinase showed a partial inhibition, suggesting that signaling cascades involving these kinases are candidates for transduction of recPrP-mediated signals. The results predict that full-length PrP C functions as a growth factor involved in development of neuronal polarity. Keywords: axon development, cell polarity, function of prion protein, neuritogenesis, neuronal differentiation. Conversion of PrP C into an alternatively folded isoform, PrP Sc , is a fundamental event in transmissible spongiform encephalopathies or prion diseases (Prusiner 1998). PrP C is a ubiquitous cell-surface membrane protein, which is anchored to the membrane by a C-terminal glycosyl phosphatidyl inositol moiety, but can also acquire a transmembrane topology or be secreted (Hegde et al. 1998;Ermonval et al. 2003; for review). The chromosomal PrP gene, Prnp, is a member of the Prn gene family that also includes the gene Prnd encoding Dpl. Dpl shares 25% sequence similarity with PrP but lacks the N-terminally located octameric repeats and hydrophobic regions present in PrP (Moore et al. 1999). In contrast to PrP, Dpl has a very low expression in the adult brain, is expressed primarily in testis, and less so in other peripheral tissues (Li et al. 2000). Address correspondence and reprint requests to Steinunn Baekkeskov, Diabetes Center, University of California San Francisco, 513 Parnassus Ave., HSW-1090, San Francisco, CA 94143-0534, USA. E-mail: s_baekkeskov@biochem.ucsf.edu Abbreviations used: CD, circular dichroism; DMSO, dimethylsulfoxide; Dpl, doppel; ERK, extracellular signal-regulated kinase; MAP2, microtubule-associated protein 2; MoDpl(27-155), full-length recombinant mouse doppel protein; MoPrP(23-230), full-length recombinant mouse prion protein; PBS, phosphate-buffered saline; PI3-kinase, phosphatidylinositol 3-kinase; PKA, protein kinase A; PKC, protein kinase C; PrP C , cellular prion protein; PrP Sc , scrapie form of the prion protein; recPrP, recombinant prion protein; SDS-PAGE, sodium d...