Decorin, a small dermatan sulfate proteoglycan, is characterized by a core protein with central leucine-rich repeat structures and a single glycosaminoglycan chain. It is catabolized by receptor-mediated uptake and subsequent intralysosomal degradation. In the present study, the localization of the receptor binding site(s) along the core protein was investigated. Various recombinant decorin fragments were consistently able to inhibit the endocytosis of wild-type decorin. The most potent inhibitory peptides were those which encompassed the central Leu125-Val230 region, i.e., the fifth to eighth leucine-rich repeat, or at least a part of it. The peptide Leu125-Val230 bound directly to the 51-kDa endocytosis receptor, and Fab fragments of antibodies against this peptide inhibited the endocytosis of decorin in a dose-dependent manner. Decorin constructs expressed in human 293 cells and comprising the full-length coding region or lacking sequences N- and/or C-terminally of the Leu125-Val230 region were all endocytosed with similar clearance rates. These data suggest that the N- and C-terminal domains of the core protein are not required for endocytosis. The receptor binding site is rather represented by contiguous leucine-rich repeat structures of the central part of the core protein. This conclusion is supported by competition experiments with biglycan, a structurally related small proteoglycan. (C) 1998 Academic Press.