Although Eph-ephrin signalling has been implicated in the migration of cranial neural crest (CNC) cells, it is still unclear how ephrinB transduces signals regulating this event. We provide evidence that TBC1d24, a putative Rab35-GTPase activating protein (Rab35 GAP), complexes with ephrinB2 via the scaffold Dishevelled (Dsh) and mediates a signal affecting contact inhibition of locomotion (CIL) in CNC cells. Moreover, we found that, in migrating CNC, the interaction between ephrinB2 and TBC1d24 negatively regulates E-cadherin recycling in these cells via Rab35. Upon engagement of the cognate Eph receptor, ephrinB2 is tyrosine phosphorylated, which disrupts the ephrinB2/Dsh/TBC1d24 complex. The dissolution of this complex leads to increasing E-cadherin levels at the plasma membrane, resulting in loss of CIL and disrupted CNC migration. Our results indicate that TBC1d24 is a critical player in ephrinB2 control of CNC cell migration via CIL.