The formation of interstitial axonal branches involves the severing of microtubules at sites where new branches form. Here we wished to ascertain whether basic fibroblast growth factor (bFGF) enhances axonal branching through alterations in proteins involved in the severing of microtubules. We found that treatment of cultured hippocampal neurons with bFGF heightens expression of both katanin and spastin, which are proteins that sever microtubules in the axon. In addition, treatment with bFGF enhances phosphorylation of tau at sites expected to cause it to dissociate from microtubules. This is important because tau regulates the access of katanin to the microtubule. In live-cell imaging experiments, axons of neurons treated with bFGF displayed greater numbers of dynamic free ends of microtubules, as well as greater numbers of short mobile microtubules. Entirely similar enhancement of axonal branching, short microtubule transport, and frequency of microtubule ends was observed when spastin was overexpressed in the neurons. Depletion of either katanin or spastin with siRNA diminished but did not eliminate the enhancement in branching elicited by bFGF. Collectively, these results indicate that bFGF enhances axonal branch formation by augmenting the severing of microtubules through both a spastin-based mode and a katanin-based mode.