Transmembrane semaphorins (Semas) serve evolutionarily conserved guidance roles, and some function as both ligands and receptors. However, the molecular mechanisms underlying the transduction of these signals to the cytoskeleton remain largely unknown. We have identified two direct regulators of Rho family small GTPases, pebble (a Rho guanine nucleotide exchange factor [GEF]) and RhoGAPp190 (a GTPase activating protein [GAP]), that show robust interactions with the cytoplasmic domain of the Drosophila Sema-1a protein. Neuronal pebble and RhoGAPp190 are required to control motor axon defasciculation at specific pathway choice points and also for target recognition during Drosophila neuromuscular development. Sema-1a-mediated motor axon defasciculation is promoted by pebble and inhibited by RhoGAPp190. Genetic analyses show that opposing pebble and RhoGAPp190 functions mediate Sema-1a reverse signaling through the regulation of Rho1 activity. Therefore, pebble and RhoGAPp190 transduce transmembrane semaphorin-mediated guidance cue information that regulates the establishment of neuronal connectivity during Drosophila development.