Glial cell line-derived neurotrophic factor (GDNF) and its three relatives constitute a novel family of neurotrophic factors, the GDNF family ligands. These factors signal through a multicomponent receptor complex comprising a glycosylphosphatidylinositol-anchored cell surface molecule (GDNF family receptor (GFR) alpha) and RET tyrosine kinase, triggering the activation of multiple signaling pathways in responsive cells. Recent gene-targeting studies have demonstrated that GDNF family ligands are essential for the development of a diverse set of neuronal populations and we have now started to understand how these ligands uniquely regulate the formation and sculpting of the nervous system. Recent studies have also revealed interactions by multiple extracellular signals during neural development. The deciphering of GDNF family ligand signaling in neural cells promises to provide vital new insights into the development and pathology of the nervous system.