Dendritic spines are small protrusions on the surface of dendrites that receive the vast majority of excitatory synapses. We previously showed that the cell-surface heparan sulfate proteoglycan syndecan-2 induces spine formation upon transfection into hippocampal neurons. This effect requires the COOH-terminal EFYA sequence of syndecan-2, suggesting that cytoplasmic molecules interacting with this sequence play a critical role in spine morphogenesis. Here, we report a novel protein that binds to the EFYA motif of syndecan-2. This protein, named synbindin, is expressed by neurons in a pattern similar to that of syndecan-2, and colocalizes with syndecan-2 in the spines of cultured hippocampal neurons. In transfected hippocampal neurons, synbindin undergoes syndecan-2–dependent clustering. Synbindin is structurally related to yeast proteins known to be involved in vesicle transport. Immunoelectron microscopy localized synbindin on postsynaptic membranes and intracellular vesicles within dendrites, suggesting a role in postsynaptic membrane trafficking. Synbindin coimmunoprecipitates with syndecan-2 from synaptic membrane fractions. Our results show that synbindin is a physiological syndecan-2 ligand on dendritic spines. We suggest that syndecan-2 induces spine formation by recruiting intracellular vesicles toward postsynaptic sites through the interaction with synbindin.