Tie2 belongs to the receptor tyrosine kinase family and functions as a receptor for Angiopoietin-1 (Ang1). Gene-targeting analyses of either Ang1 or Tie2 in mice reveal a critical role of Ang1–Tie2 signalling in developmental vascular formation. It remains elusive how the Tie2 signalling pathway plays distinct roles in both vascular quiescence and angiogenesis. We demonstrate here that Ang1 bridges Tie2 at cell–cell contacts, resulting in trans-association of Tie2 in the presence of cell–cell contacts. In clear contrast, in isolated cells, extracellular matrix-bound Ang1 locates Tie2 at cell–substratum contacts. Furthermore, Tie2 activated at cell–cell or cell–substratum contacts leads to preferential activation of Akt and Erk, respectively. Microarray analyses and real-time PCR validation clearly show the differential gene expression profile in vascular endothelial cells upon Ang1 stimulation in the presence or absence of cell–cell contacts, implying downstream signalling is dependent upon the spatial localization of Tie2.