Annexin A2 (AnxA2) is a widely expressed multifunctional protein found in different cellular compartments. In spite of lacking a hydrophobic signal peptide, AnxA2 is found at the cell surface of endothelial cells, indicative of a role in angiogenesis. Increased extracellular levels of AnxA2 in tumours correlate with neoangiogenesis, metastasis and poor prognosis. We hypothesised that extracellular AnxA2 may contribute to angiogenesis by affecting endothelial cell-cell interactions and motility. To address this question, we studied the effect of heterotetrameric and monomeric forms of AnxA2, as well as its two soluble domains on the formation and maintenance of capillary-like structures by using an in vitro co-culture system consisting of endothelial and smooth muscle cells. In particular, addition of purified domains I and IV of AnxA2 potently inhibited the vascular endothelial growth factor (VEGF)-dependent formation of the capillary-like networks in a dose-dependent manner. In addition, these AnxA2 domains disrupted endothelial cell-cell contacts in preformed capillary-like networks, resulting in the internalisation of vascular endothelial (VE)-cadherin and the formation of VE-cadherin-containing filopodia-like structures between the endothelial cells, suggesting increased cell motility. Addition of monoclonal AnxA2 antibodies, in particular against Tyr23 phosphorylated AnxA2, also strongly inhibited network formation in the co-culture system. These results suggest that extracellular AnxA2, most likely in its Tyr phosphorylated form, plays a pivotal role in angiogenesis. The exogenously added AnxA2 domains most likely mediate their effects by competing with endogenous AnxA2 for extracellular factors necessary for the initiation and maintenance of angiogenesis, such as those involved in the formation/integrity of cell-cell contacts.