In mammals with binocular vision, retinal ganglion cell (RGC) axons from each eye project to eye-specific layers in the contralateral and ipsilateral dorsal lateral geniculate nucleus (dLGN). Although layer-specific axon guidance cues that discriminate contralateral and ipsilateral RGC axons have long been postulated as a key mechanism for development of the eye-specific retinogeniculate projection, the molecular nature of such cues has remained elusive. Here we show that the extracellular glycoprotein Nell2 (also known as Nel) is expressed in the dorsomedial region of the dLGN, which corresponds to the layer receiving ipsilateral RGC axons. In Nell2 mutant mice, contralateral RGC axons invaded the ipsilateral layer of the dLGN, and ipsilateral axons terminated in partially fragmented patches, forming a mosaic pattern of contralateral and ipsilateral axon termination zones. In vitro, Nell2 exerted inhibitory effects on contralateral, but not ipsilateral, RGC axons. These results provide evidence that Nell2 acts as a layer-specific positional label in the dLGN that discriminates contralateral and ipsilateral RGC axons, and that it plays essential roles in establishment of the eye-specific projection patterns in the retinogeniculate system.