Growth-factor-induced cell signaling plays a crucial role in development; however, negative regulation of this signaling pathway is important for sustaining homeostasis and preventing diseases. SPROUTY2 (SPRY2) is a potent negative regulator of receptor tyrosine kinase (RTK) signaling that binds to GRB2 during RTK activation and inhibits the GRB2-SOS complex, which inhibits RAS activation and attenuates the downstream RAS/ERK signaling cascade. SPRY was formerly discovered in but was later discovered in higher eukaryotes and was found to be connected to many developmental abnormalities. In several experimental scenarios, increased SPRY2 protein levels have been observed to be involved in both peripheral and central nervous system neuronal regeneration and degeneration. SPRY2 is a desirable pharmaceutical target for improving intracellular signaling activity, particularly in the RAS/ERK pathway, in targeted cells because of its increased expression under pathological conditions. However, the role of SPRY2 in brain-derived neurotrophic factor (BDNF) signaling, a major signaling pathway involved in nervous system development, has not been well studied yet. Recent research using a variety of small-animal models suggests that SPRY2 has substantial therapeutic promise for treating a range of neurological conditions. This is explained by its function as an intracellular ERK signaling pathway inhibitor, which is connected to a variety of neuronal activities. By modifying this route, SPRY2 may open the door to novel therapeutic approaches for these difficult-to-treat illnesses. This review integrates an in-depth analysis of the structure of SPRY2, the role of its major interactive partners in RTK signaling cascades, and their possible mechanisms of action. Furthermore, this review highlights the possible role of SPRY2 in neurodevelopmental disorders, as well as its future therapeutic implications.