The function of the β-A4 amyloid protein precursor (APP) of Alzheimer's disease (AD) remains unclear. APP has a number of putative roles in neuronal differentiation, survival, synaptogenesis and cell adhesion. In this study, we examined the development of axons, dendrites and synapses in cultures of hippocampus neutrons derived from APP knockout (KO) mice. We report that loss of APP function reduces the branching of cultured hippocampal neurons, resulting in reduced synapse formation. Using a compartmentalised culture approach, we found reduced axonal outgrowth in cultured hippocampal neurons and we also identified abnormal growth characteristics of isolated hippocampal neuron axons. Although APP has previously been suggested to play an important role in promoting cell adhesion, we surprisingly found that APPKO hippocampal neurons adhered more strongly to a poly-L-lysine substrate and their neurites displayed an increased density of focal adhesion puncta. The findings suggest that the function of APP has an important role in both dendritic and axonal growth and that endogenous APP may regulate substrate adhesion of hippocampal neurons. The results may explain neuronal and synaptic morphological abnormalities in APPKO mice and the presence of abnormal APP expression in dystrophic neurites around amyloid deposits in AD.