Previously we showed that neuropeptide Y (NPY), a sympathetic vasoconstrictor neurotransmitter, stimulates endothelial cell migration, proliferation, and differentiation in vitro. Here, we report on NPY’s actions, receptors, and mediators in ischemic angiogenesis. In rats, hindlimb ischemia stimulates sympathetic NPY release (attenuated by lumbar sympathectomy) and upregulates NPY-Y2 (Y2) receptor and a peptidase forming Y2/Y5-selective agonist. Exogenous NPY at physiological concentrations also induces Y5 receptor, stimulates neovascularization, and restores ischemic muscle blood flow and performance. NPY-mediated ischemic angiogenesis is not prevented by a selective Y1 receptor antagonist but is reduced in Y2^–/– mice. Nonischemic muscle vascularity is also lower in Y2^–/– mice, whereas it is increased in NPY-overexpressing rats compared with their WT controls. Ex vivo, NPY-induced aortic sprouting is markedly reduced in Y2^–/– aortas and spontaneous sprouting is severely impaired in NPY^–/– mice. NPY-mediated aortic sprouting, but not cell migration/proliferation, is blocked by an antifetal liver kinase 1 antibody and abolished in mice null for eNOS. Thus, NPY mediates neurogenic ischemic angiogenesis at physiological concentrations by activating Y2/Y5 receptors and eNOS, in part due to release of VEGF. NPY’s effectiveness in revascularization and restoring function of ischemic tissue suggests its therapeutic potential in ischemic conditions.