The hypothesis that insulin-like growth factor-I is a trophic factor for primary fetal rat hypothalamic cells was tested, since we previously reported a potent mitogenic effect of this peptide on virally-transformed hypothalamic cells. It was found that insulin-like growth factor-I produced significant and dose-dependent increases in the survival of fetal hypothalamic neurons in primary mixed glial/neuronal cultures. By 48 h in vitro, cultures treated with insulin-like growth factor-I (6 nM) had twice as many neurite-bearing cells as controls, while by day 15 a five-fold difference was present. The peptide was similarly active in promoting neuronal survival in neuron-enriched (98% neurons) hypothalamic cultures. Mixed hypothalamic cultures had specific binding sites for insulin-like growth factor-I. In addition, the neurons grown in the presence of insulin-like growth factor-I had a more differentiated morphology and had significantly higher levels of protein kinase C, an enzyme that increases during neurite formation and synaptogenesis. Finally, glial-enriched cultures (greater than 99% glial cells) obtained from the fetal hypothalamus showed increased [3H]thymidine incorporation in response to insulin-like growth factor-I. These results further support the contention that insulin-like growth factor-I is a neurotrophic factor and suggest that it may participate in the normal development of the hypothalamus by increasing neuronal survival/differentiation and stimulating glial growth.