The transmembrane (TM) subfamily of Eph ligands and their receptors have been implicated in axon pathfinding and in pattern formation during embryogenesis. These functions are thought to involve repulsive interactions but this has not been demonstrated directly. In this study we used a growth cone collapse assay to determine if the TM ligands Lerk2 and HtkL have repellant guidance activity. We show that Lerk2, but not HtkL, is a collapsing factor for a subset of embryonic cortical neurons. Analysis of the effects of Lerk2 on both the morphology and the cytoskeleton of cortical neurons suggests a mechanism of action different from that of AL-1, a GPI-linked Eph ligand having similar repellant activity. Treatment with Lerk2 disrupts the organization of both the actin cytoskeleton and the microtubules and induces the formation of swellings in the center of the growth cone and along the axon. Measurement of the relative F-actin concentrations in the neurites and soma indicated that F-actin levels in the neurites decrease while those in the soma increase, with the net F-actin content of the neuron remaining unchanged. In contrast, we show that prolonged treatment with AL-1 leads to a net loss of F-actin, consistent with the hypothesis that AL-1 acts by perturbing actin polymerization. These results provide evidence that the ectodomain of Lerk2 functions as a repellant guidance cue and show that, despite overlapping specificities in vitro, the biological activities of related ligands are not necessarily overlapping. Further, TM and GPI-linked Eph ligands appear to exert repellant activity by different mechanisms, opening up the possibility that they may have different effects on growth cones in vivo.