Growth/differentiation factor-5 (GDF5) is a member of the transforming growth factor-beta superfamily which has potent effects on dopaminergic neurones in vitro and in vivo. GDF5 is under investigation as a potential therapeutic agent for Parkinson's disease (PD), which is caused by the progressive degeneration of dopaminergic neurones projecting from the substantia nigra (SN) to the striatum. In the rat ventral mesencephalon (VM; the developing SN), GDF5 expression peaks at embryonic day 14, the time at which dopaminergic neurones undergo terminal differentiation. Addition of GDF5 protein to cultures of embryonic rat VM increases the survival and improves the morphology of dopaminergic neurones in these cultures. GDF5 treatment also increases the number of cells which adopt a dopaminergic phenotype in cultures of VM progenitor cells. Intracerebral administration of GDF5 has potent neuroprotective and restorative effects on the nigrostriatal pathway in animal models of PD. Furthermore, addition of GDF5 protein to embryonic rat dopaminergic neuronal transplants improves their survival and function in a rat model of PD. Thus, GDF5 has potential applications to PD therapy as a dopaminergic neuroprotective agent and as a factor that may induce a dopaminergic neuronal fate in unrestricted progenitor cells.