Little is known regarding the role of inter-cellular interaction during neuronal differentiation. Homophilic N-cadherin engagement between cells contributes to neuronal migration. However, its function in neurite initiation is not clear. In this study, we provide the ﬁrst evidence that the adaptor protein SH2B1β regulated N-cadherin levels and neurite initiation. Overexpression of SH2B1β reduces N-cadherin levels and increased phosphotyrosine 654 β-catenin, leading to increased nerve growth factor-induced neurite initiation in PC12 cells, an established model for neuronal differentiation. In contrast, overexpression of the dominant-negative mutant SH2B1β(R555E) increases N-cadherin expression, cell-cell aggregation, and reduces neurite initiation. Moreover, SH2B1β binds directly or indirectly to N-cadherin indicative of its involvement in regulating the levels of N-cadherin. Taken together, these ﬁndings provide signiﬁcant new insights into how N-cadherin-mediated inter-cellular interactions may inﬂuence neurite initiation and how SH2B1β may regulate these processes.