The construction of a functional nervous system involves not only addition of new neurites or synapses, but also elimination of excessive or temporary structures. In addition, when a neuron is injured or undergoes remodeling, elimination of degenerating neuronal branches is essential for maintaining the homeostasis of the nervous system. The removal of neuronal materials is primarily carried out by resident phagocytes through the process of phagocytosis. Abnormal phagocytosis is associated with neurodevelopmental disorders and neurodegenerative diseases. Deciphering the mechanisms of phagocytosis in the nervous system is crucial for understanding how the developing nervous system is sculpted and for exploring potential treatments for neurodegenerative diseases. My dissertation research focuses on three major questions regarding mechanisms underlying phagocytosis of degenerating neurites. Which “eat-me” signal on the surface of degenerating neurites triggers phagocytosis? Is phagocytosis responsible for degeneration of neurites exposing the “eat-me” signal? How do phagocytes recognize the “eat-me” signal? My collaborators and I discovered that phosphatidylserine (PS) serves as an “eat-me” signal for phagocytes to recognize degenerating dendrites. We developed a genetic assay and a long-term time-lapse live imaging method to visualize PS on the surface of neurons in live Drosophila larvae. We found that PS is externalized specifically on the surface of degenerating dendrites. Furthermore, ectopic externalization of PS on otherwise healthy neurons is sufficient to trigger engulfment of neurites by phagocytes. In a follow-up study, we demonstrated that phagocytosis contributes to dendrite breakdown after injury, instead of merely cleaning up broken dendrites. Injured dendrites break down through a typical process called Wallerian degeneration. This process was thought to be solely instructed by a self-destruction program within the injured dendrites. We found that key players of Wallerian degeneration regulate PS externalization after injury. In parallel with the self-destruction program, PS-induced phagocytic attack by phagocytes helps dendrites to break down after injury. We took a further step to investigate how PS-exposing dendrites are recognized by phagocytes. In Drosophila, Draper (Drpr) is the most important engulfment receptor instructing the phagocytosis of neuronal materials. However, whether Drpr directly senses PS in vivo has been unknown. We discovered that Orion, a chemokine-like secreted protein, bridges PS on degenerating dendrites and Drpr on phagocytes in vivo. We also found that the level of available Orion proteins in the extracellular space determines the sensitivity of phagocytes to PS. In summary, this dissertation elucidates in vivo mechanisms that PS on degenerating dendrites is tagged by Orion which allows for recognition by phagocytes. PS-induced phagocytosis coordinates with the self-destruction program to break down dendrites after injury.