Protein tyrosine kinase 7 (PTK7) is a member of the defective receptor protein tyrosine kinase family which lacks catalytic activity. Expression of PTK7 is increased in various cancers but its role in carcinogenesis is not well understood. We previously showed that disruption of PTK7 function suppresses VEGF-induced angiogenic phenotypes in HUVECs and mice. Here, we investigated molecular mechanisms for modulating VEGF-induced physiological effects by PTK7. Treatment with a high concentration of extracellular domain of PTK7 (soluble PTK7; sPTK7) or knockdown of PTK7 inhibited VEGF-induced phosphorylation of kinase insert domain receptor (KDR) but did not inhibit phosphorylation of fms-related tyrosine kinase 1 (FLT-1) in HUVECs. PTK7, more specifically sPTK7, interacted with KDR but not with FLT-1 in HUVECs and HEK293 cells. In vitro binding assay showed that sPTK7 formed oligomers with the extracellular domain of KDR (sKDR) up to an approximately 1:3 molar ratio, and vice versa. sPTK7 at lower molar ratios than sKDR enhanced the binding of VEGF to sKDR. At the same or higher molar ratios, it reduced the binding of VEGF to sKDR. Increasing concentrations of sPTK7 or increasing levels of PTK7 expression first increased and then decreased VEGF-induced KDR phosphorylation, migration, and capillary-like tube formation of HUVECs, as well as in vivo angiogenesis. Taken together, our data demonstrates that PTK7 regulates the activity of KDR biphasically by inducing oligomerization of KDR molecules at lower concentrations and by surrounding KDR molecules at higher concentrations.