To foster axonal growth from a Schwann cell bridge into the caudal spinal cord, spinal cells caudal to the implant were transduced with adeno-associated viral (AAV) vectors encoding for brain-derived neurotrophic factor (BDNF) and neurotrophin-3 (AAV-NT-3). Control rats received AAV vectors encoding for green fluorescent protein or saline. AAV-BDNF- and AAV-NT-3-transduced 293 human kidney cells produced and secreted BDNF or NT-3, respectively, in vitro. The secreted neurotrophins were biologically active; they both promoted outgrowth of sensory neurites in vitro. In vivo, transgene expression was observed predominantly in neurons for at least 16 weeks after injection. Compared with controls, a modest though significant improvement in hind-limb function was found in rats that received AAV-BDNF and AAV-NT-3. Retrograde tracing demonstrated that twice as many neurons with processes extending toward the Schwann cell graft were present in the second lumbar cord segment of AAV-BDNF- and AAV-NT-3-injected animals compared with controls. We found no evidence, however, for growth of regenerated axons from the Schwann cell implant into the caudal cord. Our results suggest that AAV vector-mediated overexpression of BDNF and NT-3 in the cord caudal to a Schwann cell bridge modified the local lumbar axonal circuitry, which was beneficial for locomotor function.