Peanut agglutinin-binding disaccharides and chondroitin sulfate mark transient mesenchymal barriers to advancing motor and sensory axons innervating the hindlimbs during chick development. Here we show that the vast majority of these carbohydrates are at the critical stage and location attached to the versican splice variants V0 and V1. We reveal that the isolated isoforms of this extracellular matrix proteoglycan suppress axon extension at low concentrations and induce growth cone collapse and rapid retraction at higher levels. Moreover, we demonstrate that versican V0 and/or V1, recombinantly expressed in collagen-I gels or ectopically deposited in the hindlimbs of chicken embryos in ovo, cause untimely defasciculation and axon stalling. Consequently, severe disturbances of nerve patterning are observed in the versican-treated embryos. Our experiments emphasize the inhibitory capacity of versicans V0 and V1 in axonal growth and evidence for their function as basic guidance cues during development of the peripheral nervous system.