Ephrin signaling through Eph receptor tyrosine kinases can promote attraction or repulsion of axonal growth cones during development. However, the mechanisms that determine whether Eph signaling promotes attraction or repulsion are not known. We show here that the Rho family GEF Vav2 plays a key role in this process. We find that, during axon guidance, ephrin binding to Ephs triggers Vav-dependent endocytosis of the ligand-receptor complex, thus converting an initially adhesive interaction into a repulsive event. In the absence of Vav proteins, ephrin-Eph endocytosis is blocked, leading to defects in growth cone collapse in vitro and significant defects in the ipsilateral retinogeniculate projections in vivo. These findings suggest an important role for Vav family GEFs as regulators of ligand-receptor endocytosis and determinants of repulsive signaling during axon guidance.