Secreted Wnts play crucial roles in synaptogenesis and synapse maintenance, but endogenous factors promoting synapse elimination in central neurons remain unknown. Here we show that proline-rich 7 (PRR7) induces specific removal of excitatory synapses and acts as a Wnt inhibitor. Remarkably, transmembrane protein PRR7 is activity-dependently released by neurons via exosomes. Exosomal PRR7 is uptaken by neurons through membrane fusion and eliminates excitatory synapses in neighboring neurons. Conversely, PRR7 knockdown in sparse neurons greatly increases excitatory synapse numbers in all surrounding neurons. These non-cell autonomous effects of PRR7 are effectively negated by augmentation or blockade of Wnt signaling. PRR7 exerts its effect by blocking the exosomal secretion of Wnts, activation of GSK3 beta, and promoting proteasomal degradation of PSD proteins. These data uncover a proximity-dependent, reciprocal mechanism for the regulation of excitatory synapse numbers in local neurons and demonstrate the significance of exosomes in interneuronal signaling in the vertebrate brain.