Sox21, a high-mobility group box transcription factor, is expressed throughout the immature neural stem/progenitor population in ventricular zone but not in the cortical plate in embryonic mouse brain and its expression is restricted to the subventricular zone in the adult brain. In undifferentiated PC12 cells, endogenous Sox21 expression is detected but its expression ceases during the nerve growth factor (NGF)-induced neuronal differentiation. Overexpression of Sox21 results in a substantial repression of NGF-induced neurite outgrowth in PC12 cells. Further, we biochemically identified a Sox21-associating protein, Y-box binding protein 1 which not only binds to Sox21 but also partially restores NGF-induced neurite outgrowth of PC12 cells inhibited by Sox21. These results suggest that Sox21 is a repressor of neuronal differentiation in the developing nervous system.