Cell adhesion molecules belonging to the immunoglobulin superfamily promote cell aggregation and neurite outgrowth. These proteins are multidomain molecules comprising a number of distinct modules, notably Ig domains of the C2 class and fibronectin type III repeats. A subgroup of these neural adhesion molecules are linked to the membrane with a glycosylphosphatidylinositol anchor and show a more restricted pattern of expression in the embryo. Among them, the human homologue of the transient axonal glycoprotein, named TAX-1, shares a great degree of similarity at the protein level with rodent TAG-1. In the present study we set out to determine which domains of TAX-1 are involved in promoting the homophilic, adhesive properties of the molecule. We established stable Schneider-2 cell lines expressing the intact molecule, the fibronectin, or the immunoglobulin domains. The fibronectin domains were necessary and sufficient to mediate homophilic binding and induce cell aggregation, a response also observed with cells expressing the intact TAX-1 molecule. Aggregation was inhibited by the secreted form of the TAG-1 protein. On the other hand, the immunoglobulin domains by themselves were not able to induce cell aggregation. In addition, TAX-1 was localized in areas of cell contact among aggregating cells, justifying its role as an adhesion molecule.