Secreted Wnt proteins influence neural connectivity by regulating axon guidance, dendritic morphogenesis and synapse formation. We report a new role for Wnt and Frizzled proteins in establishing the anteroposterior polarity of the mechanosensory neurons ALM and PLM in C. elegans. Disruption of Wnt signaling leads to a complete inversion of ALM and PLM polarity: the anterior process adopts the length, branching pattern and synaptic properties of the wild-type posterior process, and vice versa. Different but overlapping sets of Wnt proteins regulate neuronal polarity in different body regions. Wnts act directly on PLM via the Frizzled LIN-17. In addition, we show that they are needed for axon branching and anteriorly directed axon growth. We also find that the retromer, a conserved protein complex that mediates transcytosis and endosome-to-Golgi protein trafficking, plays a key role in Wnt signaling. Deletion mutations of retromer subunits cause ALM and PLM polarity, and other Wnt-related defects. We show that retromer protein VPS-35 is required in Wnt-expressing cells and propose that retromer activity is needed to generate a fully active Wnt signal.