Blood vessel networks are typically formed by angiogenesis, a process in which new vessels form by sprouting of endothelial cells from pre-existing vessels. This process is initiated by vascular endothelial growth factor (VEGF)-mediated tip cell selection and subsequent angiogenic sprouting. Surprisingly, we found that VEGF directly controls the expression of Plexin-D1, the receptor for the traditional repulsive axon guidance cue, semaphorin 3E (Sema3E). Sema3E–Plexin-D1 signaling then negatively regulates the activity of the VEGF-induced Delta-like 4 (Dll4)–Notch signaling pathway, which controls the cell fate decision between tip and stalk cells. Using the mouse retina as a model system, we show that Plexin-D1 is selectively expressed in endothelial cells at the front of actively sprouting blood vessels and its expression is tightly controlled by VEGF secreted by surrounding tissues. Therefore, although the Sema3E secreted by retinal neurons is evenly distributed throughout the retina, Sema3E–Plexin-D1 signaling is spatially controlled by VEGF through its regulation of Plexin-D1. Moreover, we show that gain and loss of function of Sema3E and Plexin-D1 disrupts normal Dll4 expression, Notch activity, and tip/stalk cell distribution in the retinal vasculature. Finally, the retinal vasculature of mice lacking sema3E or plexin-D1 has an uneven growing front, a less-branched vascular network, and abnormal distribution of dll4-positive cells. Lowering Notch activity in the mutant mice can reverse this defect, solidifying the observation that Dll4–Notch signaling is regulated by Sema3E–Plexin-D1 and is required for its function in vivo. Together, these data reveal a novel role of Sema3E–Plexin-D1 function in modulating angiogenesis via a VEGF-induced feedback mechanism.