During retinal development, cell proliferation and exit from the cell cycle must be precisely regulated to ensure the generation of the appropriate numbers and proportions of the various retinal cell types. Previously, we showed that pituitary adenylyl cyclase-activating polypeptide (PACAP) exerts a neuroprotective effect in the developing retina of rats, through the cAMP–cAMP-dependent protein kinase (protein kinase A) (PKA) pathway. Here, we show that PACAP also regulates the proliferation of retinal progenitor cells. PACAP, PACAP-specific receptor (PAC1), and the receptors activated by both PACAP and vasoactive intestinal peptide (VIP), VPAC1 and VPAC2, are expressed during embryonic and postnatal development of the rat retina. Treatment of retinal explants with PACAP38 reduced the incorporation of [3H]thymidine as well as the number of 5-bromo-2′-deoxyuridine-positive and cyclin D1-positive cells. Pharmacological experiments indicated that PACAP triggers this antiproliferative effect through the activation of both PAC1 and VPACs, and the cAMP–PKA pathway. In addition, PACAP receptor activation decreased both cyclin D1 mRNA and protein content. Altogether, the data support the hypothesis that PACAP is a cell-extrinsic regulator with multiple roles during retinal development, including the regulation of proliferation in a subpopulation of retinal progenitor cells.