A new clonal nerve-like cell line from the rat eye is used to show that cell-substratum adhesion can modulate neurite fasciculation. When cells are grown on a substratum of intermediate adhesiveness their neurites adhere to each other and form fascicles. In contrast, cells grown on more adhesive surfaces spread and extend individual neurites. The direct relationship between the initial rates of cell-substratum adhesion and neurite fasciculation shows that the extent of axon fasciculation which occurs in vivo may be determined by the extracellular environment through which the axons are growing.