Causes of retinoid resistance often observed in neuroblastomas are unknown. We studied all trans-retinoic acid (RA) signaling in neuroblastoma cells differing in N-myc levels in terms of neurite formation, expression of tissue transglutaminase, neuronal marker proteins, matrix metalloproteinases (MMPs), and activation of Rac1 and Cdc42. Poor invasiveness observed in SH-SY5Y, LA-N-5, and SMS-KCNR cells was associated with RA-induced neurite formation, Cdc42 activation and N-myc down regulation; expression of constitutively active Cdc42 down regulated N-myc expression and reduced invasion in RA-resistant SK-N-BE(2) and IMR32 cells. RA treatment for 24 h transiently increased invasion and expression of MMP9 in SH-SY5Y, LA-N-5 and MMP2 in SMS-KCNR cells. MMP inhibition prevented RA-induced neurite formation indicating a role in differentiation. Variation in RA signaling thus follows a defined pattern and relates to invasive potential. A defective RA signaling might result in retinoid resistance and unpredictable clinical outcome observed in some neuroblastomas.