In PC12 rat pheochromocytoma cells, nerve growth factor (NGF)-induced neuronal differentiation is blocked by constitutively active dominant mutants of RhoA but augmented by negative ones, suggesting a not yet elucidated inhibitory signaling link between NGF receptors and RhoA. Here we show that NGF treatment rapidly translocates RhoA from the plasma membrane to the cytosol and simultaneously decreases RhoA affinity to its target Rho-associated kinase (ROK), a key mediator of neurite outgrowth. This effect was transient, because after 2 days of NGF treatment, RhoA relocated from the cytosol to the plasma membrane, and its GTP loading returned to a level found in undifferentiated cells. Inhibition of RhoA is mediated by activation of the TrkA receptor, because NGF failed to induce RhoA translocation and inhibition of ROK binding in nnr5 cells that lack TrkA, whereas the inhibition was reconstituted in receptor add-back B5 cells. In MM17-26 cells, which due to expression of dominant negative Ras do not differentiate, NGF-stimulated transient RhoA inhibition was unaffected. The inhibitory pathway from TrkA to RhoA involves phosphatidylinositol-3-kinase (PI3K), because the inhibitors LY294002 or wortmannin prevented NGF-induced RhoA translocation and increased RhoA association with ROK. Furthermore, inhibition of PI3K significantly reduced NGF- mediated Rac1 activation, whereas dominant negative Rac1 abolished the inhibitory signaling to RhoA. Taken together, these data indicate that NGF-mediated activation of TrkA receptor stimulates PI3K, which in turn increases Rac1 activity to induce transient RhoA inactivation during the initial phase of neurite outgrowth.