The integrin receptor αvβ5 controls two independent forms of interactions of the retinal pigment epithelium (RPE) with adjacent photoreceptor outer segments that are essential for vision. αvβ5 localizes specifically to apical microvilli of the RPE and contributes to retinal adhesion that maintains RPE contacts with intact outer segments at all times. Additionally, αvβ5 synchronizes diurnal bursts of RPE phagocytosis that clear photoreceptor outer segment fragments (POS) shed in a circadian rhythm. Dependence of retinal phagocytosis and adhesion on αvβ5 receptors suggests that the extracellular matrix ensheathing RPE microvilli contains ligands for this integrin. Here we studied mice lacking expression of functional MFG-E8 to test the contribution of this integrin ligand to αvβ5 functions in the retina. Lack of MFG-E8 only minimally reduced retinal adhesion. In contrast, lack of MFG-E8, like lack of αvβ5 receptor, eliminated αvβ5 downstream signaling involving the engulfment receptor MerTK and peak POS phagocytosis, both of which follow light onset in wild-type retina. MFG-E8-deficient RPE in primary culture retained normal epithelial morphology and levels of apical αvβ5 receptors, but showed impaired binding and engulfment of isolated POS. Soluble or POS-bound recombinant MFG-E8 was sufficient to fully restore phagocytosis by MFG-E8-deficient RPE. Furthermore, MFG-E8 supplementation strongly increased POS binding by wild-type and MerTK-deficient RPE, but did not affect POS binding by RPE lacking αvβ5. Thus, MFG-E8 stimulates rhythmic POS phagocytosis by ligating apical αvβ5 receptors of the RPE. These results identify MFG-E8 as the first extracellular ligand in the retina that is essential for diurnal POS phagocytosis.