Although mature neurotrophins are well described trophic factors that elicit retrograde survival signaling, the precursor forms of neurotrophins (i.e., proneurotrophins) can function as high-affinity apoptotic ligands for selected neural populations. An outstanding question is whether target-derived proneurotrophins might affect neuronal survival/death decisions through a retrograde transport mechanism. Since neurotrophin-3 (NT-3) is highly expressed in non-neural tissues that receive peripheral innervation, we investigated the localized actions of its precursor (proNT-3) on sympathetic neurons in the present study. Pharmacological inhibition of intracellular furin proteinase activity in 293T cells resulted in proNT-3 release instead of mature NT-3, whereas membrane depolarization in cerebellar granule neurons stimulated endogenous proNT-3 secretion, suggesting that proNT-3 is an inducible bona fide ligand in the nervous system. Our data also indicate that recombinant proNT-3 induced sympathetic neuron death that is p75(NTR)- and sortilin-dependent, with hallmark features of apoptosis including JNK (c-Jun N-terminal kinase) activation and nuclear fragmentation. Using compartmentalized culture systems that segregate neuronal cell bodies from axons, proNT-3, acting within the distal axon compartment, elicited sympathetic neuron death and overrode the survival-promoting actions of NGF. Together, these results raise the intriguing possibility that dysregulation of proneurotrophin processing/release by innervated targets can be deleterious to the neurons projecting to these sites.