The trkC locus encodes catalytic and noncatalytic receptors, generated by alternative splicing. These primary high-affinity neurotrophin-3 (NT-3) receptors may act in concert to modulate responsiveness to NT-3. Signal modulation can also be achieved by receptors that are post-translationally processed. We report that the noncatalytic TrkC receptor, TrkCNC2, is cleaved at the membrane-proximal region of its extracellular domain. This generates a soluble ectodomain (gp90 TrkCNC2 ) recovered in the cell culture medium and a membrane-bound fragment (p20 TrkCNC2 ), which contains the transmembrane and intracellular regions including the juxtamembrane and the NC2-specific cytoplasmic domains. We also show that this processing, which does not occur in the TrkC catalytic counterpart, is upregulated by NT-3 and upon treatment with the tumor promoter 12-O-tetradecanoylphorbol-13-acetate. Moreover, cleavage inhibition after EDTA or 1.10 phenanthroline treatment suggests involvement of a metalloprotease(s). Finally, this post-translational processing was observed not only in TrkCNC2-overexpressing NIH3T3 cells but also in primary cultures of cortical neurons and brain extracts. This study shows that, in addition to alternative splicing, ectodomain shedding represents a novel means of regulating TrkC receptor signaling, and consequently NT-3 biological effects on target cells.