Neurotrophin 3 (NT-3) promotes the survival and induces neurite outgrowth from a subset of neural crest (NC) and placode-derived neurons. We now report that this growth factor regulates the proliferation of cultured NC progenitor cells grown in a serum-free defined medium. In cultures of somites containing NC cells at migratory stages, NT-3 promotes a 2- to 8.4-fold increase in the number of NC cells incorporating [3H]thymidine into nuclei and a 1.8- to 4.8-fold increase in NC cell number compared to controls without added factor. NT-3 also promoted, to a lesser extent, the proliferation of NC cells in homogeneous cultures established from NC clusters. In addition to its effect on NC cells, NT-3 was mitogenic to somite cells in the mixed NC/somite cultures. These data demonstrate that NT-3 can act directly on the NC cells. They also indicate that the response of NC cells to NT-3 may be modulated by the presence of somitic cells. We suggest that NT-3 may be one of the central nervous system-derived factors that mediate NC cell proliferation in vivo.