Regulation of axonal fasciculation plays an important role in the precise patterning of neural circuits. Selective fasciculation contributes to the sorting of different types of axons and prevents the misrouting of axons. However, axons must defasciculate once they reach the target area. To study the regulation of fasciculation, we focused on the primary vestibulo-cerebellar afferents (PVAs), which show a dramatic change from fasciculated axon bundles to defasciculated individual axons at their target region, the cerebellar primordium. To understand how fasciculation and defasciculation are regulated in this system, we investigated the roles of murine SC1-related protein (MuSC), a molecule belonging to the immunoglobulin superfamily. We show: (i) by comparing 1,1'-dioctadecyl-3,3,3',3'-tetramethylindocarbocyanine perchlorate (Dil) labelling and anti-MuSC immunohistochemistry, that downregulation of MuSC in PVAs during development is concomitant with the defasciculation of PVA axons; (ii) in a binding assay with cells expressing MuSC, that MuSC has cell-adhesive activity via a homophilic binding mechanism, and this activity is increased by multimerization; and (iii) that MuSC also displays neurite outgrowth-promoting activity in vestibular ganglion cultures. These findings suggest that MuSC is involved in axonal fasciculation and its downregulation may help to initiate the defasciculation of PVAs.