Lymphatic vessels grow through active sprouting and mature into a vascular complex including lymphatic capillaries and collecting vessels that ensure fluid transport. However, the signaling cues that direct lymphatic sprouting and patterning remains unclear. In this study, we demonstrated the chemokine signaling, specifically through CXCL12/CXCR4 plays critical roles in regulating lymphatic development. We showed that LEC specific CXCR4 deficient embryos and CXCL12 mutant embryos exhibited server defects in lymphatic sprouting, migration, and lymphatic valve formation. We also discovered that CXCL12, originating from peripheral nerves, directs the migration of dermal lymphatic vessels to align with nerves in developing skin. Deletion CXCR4 or blockage of CXCL12/CXCR4 activity results in reduced VEGFR3 levels on the LEC surface. This, in turn, impairs VEGFC mediated VEGFR3 signaling and downstream PI3K/AKT activities. Taken together, these data identify previously unknown chemokine signaling originating from peripheral nerves that guides dermal lymphatic sprouting and patterning. Our work identifies for the first time a neuro-lymphatics communications during mouse development and reveals a novel mechanism by which CXCR4 modulates VEGFC/VEGFR3/AKT signaling.