Here, we have used a chimera of green fluorescent protein (GFP) and the glucocorticoid receptor (GR) to study retrograde movement of a model soluble (i.e., non-vesicle-associated) protein in axons and dendrites of cultured NT2-N neurons. It is known that in non-neuronal cells, the GFP-GR moves from cytoplasm to the nucleus in a steroid-dependent manner by a rapid, hsp90-dependent mechanism. When rapid movement is inhibited by geldanamycin (GA), a specific inhibitor of the protein chaperone hsp90, the GFP-GR translocates slowly to the nucleus by diffusion. Here we show that GFP-GR expressed in hormone-free neurons is localized in both cytoplasm and neurites, and upon treatment with dexamethasone (DEX), it moves to the nucleus. In neurites, movement by diffusion is not possible, and we show that movement of the GFP-GR from neurites is blocked by geldanamycin, suggesting that the hsp90-dependent movement machinery is required for retrograde movement. In cells treated with both dexamethasone and geldanamycin, the GFP-GR becomes concentrated in fluorescent globules located periodically along the neurites. Carboxyl terminus of Hsc70-interacting protein (CHIP), the E3 ubiquitin ligase for the GR, also concentrates in the same loci in a steroid-dependent and geldanamycin-dependent manner. If geldanamycin is removed, the GFP-GR exits the globules and continues its retrograde movement. However, in the continued presence of geldanamycin, the GFP-GR in the globules undergoes proteasomal degradation, suggesting that the globules function as degradasomes. This is the first evidence for a linkage between receptor trafficking along neurites and receptor degradation by the proteasome.