The myelin axonal growth inhibitor NI-220/250 (Nogo-A) has attracted considerable attention in elucidating the mechanisms that account for the lack of plasticity in the adult central nervous system. The cognate monoclonal antibody IN-1, which was obtained prior to the molecular characterization of its Nogo-A antigen, has played a crucial role in this respect. However, this murine IgM/kappa antibody does not only provide an inappropriate format for in vivo studies, its low antigen affinity has also hampered the thorough structure-function analysis of its neutralizing effect toward the Nogo-A inhibitor on a molecular basis. We describe here the affinity maturation of a bacterially produced functional IN-1 F(ab) fragment via protein engineering. A soluble fragment of Nogo-A derived from the central exon 3 of its gene, which was prepared by secretion into the periplasm of Escherichia coli, served as a target in these experiments. After repeated cycles of site-directed random mutagenesis and screening, the mutant II.1.8 of the IN-1 F(ab) fragment was obtained, carrying five side chain substitutions within CDR-L3. Its dissociation constant for the complex with the recombinant Nogo-A fragment was determined in surface plasmon resonance measurements as approximately 1 microM. The affinity of the unmutated IN-1 F(ab) fragment was 8-fold lower. The engineered F(ab) fragment appeared to be well suited for the specific detection of Nogo-A in immunochemical assays and for the histochemical staining of myelin-rich tissue sections. Most importantly, its concentration-dependent neutralizing effect on the Nogo-A inhibitory activity was significantly enhanced in cell culture. This study confirms Nogo-A to be the antigen of the IN-1 antibody and it demonstrates increased potential of the engineered F(ab) fragment as a reagent for promoting axonal regeneration in vivo.