During the development of the peripheral nervous system, Schwann cells, the myelin-forming glia, migrate along axons before initiating myelination. We previously demonstrated that endogenous neurotrophin-3 (NT3) acting through the TrkC tyrosine kinase receptor enhances migration of premyelinating Schwann cells. This signaling pathway is mediated by the c-Jun N-terminal kinase (JNK) cascade regulated by the Rho GTPases Rac1 and Cdc42. However, missing is the link between TrkC and the GTPases. Here, we show that a guanine-nucleotide exchange factor (GEF), Dbl's big sister (Dbs), couples with TrkC to activate Cdc42 in Schwann cells. Furthermore, TrkC directly phosphorylates Dbs, thereby inducing the Cdc42-GEF activity. Taken together, activation of TrkC triggers Schwann cell migration by regulating Dbs upon direct tyrosine phosphorylation, providing a mechanism whereby a membrane receptor tyrosine kinase can induce the activation of Rho GTPase-GEFs.