Retinoic acid (RA) induces differentiation of neuroblastoma cells in vitro and is used with variable success to treat aggressive forms of this disease. This variability in clinical response to RA is enigmatic, as no mutations in components of the RA signaling cascade have been found. Using a large-scale RNAi genetic screen, we identify crosstalk between the tumor suppressor NF1 and retinoic acid-induced differentiation in neuroblastoma. Loss of NF1 activates RAS-MEK signaling, which in turn represses ZNF423, a critical transcriptional coactivator of the retinoic acid receptors. Neuroblastomas with low levels of both NF1 and ZNF423 have extremely poor outcome. We find NF1 mutations in neuroblastoma cell lines and in primary tumors. Inhibition of MEK signaling downstream of NF1 restores responsiveness to RA, suggesting a therapeutic strategy to overcome RA resistance in NF1-deficient neuroblastomas.