Fasciclin I is a membrane-associated glycoprotein that is regionally expressed on a subset of fasciculating axons during neuronal development in insects; it is expressed on apposing cell surfaces, suggesting a role in specific cell adhesion. In this paper we show that Drosophila fasciclin I is a novel homophilic cell adhesion molecule. When the nonadhesive Drosophila S2 cells are transfected with the fasciclin I cDNA, they form aggregates that are blocked by antisera against fasciclin I. When cells expressing fasciclin I are mixed with cells expressing fasciclin III, another Drosophila homophilic adhesion molecule, the mixture sorts into aggregates homogeneous for either fasciclin I- or fasciclin III-expressing cells. The ability of these two novel adhesion molecules to mediate cell sorting in vitro suggests that they might play a similar role during neuronal development.