Proteoglycans appear to play an important role in modulating cell-cell and cell-matrix interactions during nervous tissue histogenesis. The nervous tissue-specific chondroitin sulfate proteoglycans neurocan and phosphacan/protein-tyrosine phosphatase-zeta/beta were found to be high-affinity ligands of the neural cell adhesion molecule TAG-1/axonin-1, with dissociation constants of 0.3 nM and 0.04 nM, respectively. Phosphacan binding was decreased by approximately 70% following chondroitinase treatment, whereas binding of neurocan was not affected. The contribution of chondroitin sulfate chains to the binding of neurocan and phosphacan to TAG-1/axonin-1 is therefore the opposite of that previously observed for their binding to two other Ig-superfamily neural cell adhesion molecules, Ng-CAM/L1 and N-CAM. Moreover, whereas phosphacan interactions with certain proteins are mediated at least in part by N-linked oligosaccharides on the proteoglycan, N-deglycosylation of phosphacan had no effect on its binding to TAG-1/axonin-1. In addition to the chondroitin sulfate proteoglycans described above, we have demonstrated that N-CAM is a high-affinity ligand of TAG-1/axonin-1 (Kd approximately 1 nM), and specific binding of TAG-1/axonin-1 to tenascin-C was also observed (Kd approximately 9 nM). Immunocytochemical studies of embryonic and early postnatal nervous tissue showed an overlapping localization of TAG-1/axonin-1 with all four of these ligands, further supporting the biological significance of their ability to interact in vitro.