Dendritic arborization is important for neuronal development as well as the formation of neural circuits. Rac1 is a member of the Rho GTPase family which serves as regulators of neuronal development. BCR (breakpoint cluster region) is a Rac1 GTPase-activating protein which is abundantly expressed in the central nervous system. Here we show that BCR plays a key role in neuronal development. Dendritic arborization and actin polymerization were attenuated by overexpression of BCR in hippocampal neurons. Knockdown of BCR using specific shRNAs increased the dendritic arborization as well as actin polymerization. The number of dendrites of null mutant BCR−/− mice was considerably increased compared with wild type. The function of the BCR GTPase-activating domain could be controlled by PTPRT (protein tyrosine phosphatase receptor T) expressed principally in the brain. We demonstrate that tyrosine 177 of BCR was the main target of PTPRT and the BCR mutant mimicking dephosphorylation of tyrosine 177 alleviated the attenuation of dendritic arborization. Additionally the attenuated dendritic arborization by BCR overexpression was relieved upon co-expression of PTPRT. When PTPRT was knocked down by specific shRNA, the dendritic arborization was significantly reduced. The function of the BCR GTPase-activating domain was controlled by means of conversions between the intra- and inter-molecular interactions that are finely regulated through the dephosphorylation of a specific tyrosine residue by PTPRT. We thus show conclusively that BCR is a novel substrate of PTPRT and that BCR is involved in the regulation of neuronal development via control of the BCR GTPase-activating domain function by PTPRT.