During development, cellular self-organization by cell segregation leads to boundary formation and is critical for the organization of morphogenetic movement and tissue patterning. Signaling between membrane-bound EPHRINS and EPH receptor tyrosine kinases is essential in boundary formation, driving segregation between EPHRIN-expressing and EPH-expressing cells. Here I examine the basic cellular mechanistic drivers of EPH/EPHRIN cellular self-organization and boundary formation. Using a cell culture system to model EPH/EPHRIN cell segregation I analyzed the contact angle of cells to estimate the interfacial tension between EPHB2- and EPHRIN-B1-expressing cells. Heterotypic cell pairs exhibited increased interfacial tension relative to homotypic cell pairs. Inhibitors of actomyosin contractility significantly diminished this increase, suggesting that actomyosin contractility drives heterotypic interfacial tension. Cell segregation assays revealed that EPH/EPHRIN driven segregation is actomyosin contractility dependent. Further, atomic force microscopy showed that EPH/EPHRIN signaling results in increased cortical tension during cell segregation. Actomyosin contractility also drives increased EPHB2:EPHB2 homotypic contacts through an increase in tension away from the cell contact. Using a mouse model I demonstrated that actomyosin contractility is critical for EPH/EPHRIN cell segregation in vivo as well. Finally, I demonstrated that tissue-wide changes in cellular organization and tissue shape are driven by minimization of heterotypic contact. These data suggest a model for cell segregation and tissue organization in which Eph/ephrin signaling results in a cortical actin differential that prevents cells from making stable contacts and drives cell segregation to affect tissue morphology by modulating interfacial tension.