We have previously reported the isolation of an EGF-responsive precursor from the embryonic and adult mouse striatum. This precursor exhibits self renewal and the ability to produce a sphere of undifferentiated cells which can be induced to differentiate into neurons and glia. RT-PCR analysis of these spheres of undifferentiated cells revealed the expression of mRNA for the trkB neurotrophin receptor, both with and without the catalytic domain, and little or no expression of trkA or trkC. We examined the actions of BDNF on the fate of EGF-generated neural precursors. Ten days after a one-time exposure to BDNF, single EGF-generated spheres showed a twofold increase in neuron number and a marked enhancement in neurite outgrowth. Examination of neuronal nuclei with immunochemical probes for c-fos and bromodeoxyuridine revealed that the actions of BDNF were directly upon neuronal cells and did not involve division of neuronal precursors. The twofold increase in neuronal number due to BDNF, observed after 10 d in vitro, was significantly reduced after 21 d in vitro and was not apparent at 27 d in vitro. Quantitative analyses revealed that while repeated application of BDNF did not prevent the loss of neuron number over time, it did result in a significant increase in neurite numbers. Moreover, delayed addition of BDNF mimicked the increase in neuronal numbers seen when BDNF was present throughout. These BDNF actions did not appear to involve the enhancement of a novel neuronal phenotype, with all effects being due to increase in the numbers and neurite outgrowth of neurons that colocalize GABA and substance P. These findings suggest that BDNF markedly enhances the antigenic and morphologic differentiation of EGF-generated neuronal precursors. BDNF alone does not appear to act as a survival factor for neuronal precursors nor is it sufficient for preventing their death over time.