Gelsolin belongs to a family of proteins that modulate the structural dynamics of cytoskeletal actin. Gelsolin activity is required for the redistribution of actin occurring during membrane ruffling, cell crawling, and platelet activation. A point mutation (G654A) in the gelsolin gene causes a dominantly inherited systemic amyloidosis called familial amyloidosis of the Finnish type (FAF). This disease is characterized by a cranial neuropathy that cannot be explained solely by amyloid deposits. To address the question of whether gelsolin has a specific role in neural cell development, we transfected cDNA for wild type and G654A point-mutated gelsolin into a neural cell line, Paju, which can be induced to differentiate by treatment with phorbol 12-myristate 13-acetate. Overexpressed wild type gelsolin inhibited neural differentiation whereas mutated gelsolin did not, indicating that appropriate gelsolin activity is essential for neural sprouting. The G654A mutant gelsolin induced stabilization of F-actin and reduced the plasticity of neural development. This provides a novel etiopathogenetic mechanism for the neuronal dysfunction in FAF.