The extracellular domain of receptor protein tyrosine phosphatase beta (RPTPbeta) is composed of several domains which mediate its interactions with distinct ligands present on the surface of either neurons or glial cells. Here, we demonstrate that the fibronectin type III domain (FNIII) of RPTPbeta binds to glial tumor-derived cell lines and primary astrocytes. We used affinity purification to isolate several proteins that specifically bind to the FNIII domain of RPTPbeta. One of these, a 240 kDa protein that was purified from U118MG glioblastoma cell, was identified as tenascin C based on the amino acid sequence of several tryptic peptides. The interaction of RPTPbeta with tenascin C was found to mediate cell adhesion. Adhesion and spreading of SF763T astrocytoma cells expressing RPTPbeta on tenascin C was specifically abolished by the addition of a soluble fragment containing the FNIII domain of the receptor. RPTPbeta-dependent cell adhesion was mediated by binding to the alternatively spliced FNIII repeats A1,2,4 (TnfnA1,2,4) of tenascin C. Furthermore, COS cells expressing RPTPbeta adhere to TnfnA1,2,4, while the parental cells did not. These results demonstrate that the FNIII domain of RPTPbeta binds to tenascin C and suggest that RPTPbeta present on glial tumor cells is a primary adhesion receptor system to the extracellular matrix.