Heparanase is an endo-beta-D-glucuronidase responsible for the cleavage of heparan sulfate, participating in extracellular matrix degradation and remodeling. Heparanase activity is well correlated with the potential for metastasis and angiogenesis in a large number of tumor-derived cell types, directly implicating the involvement of heparanase in tumor progression. Here, we provide the first evidence that the hydrophobic C-terminus region of heparanase has specific roles in intracellular trafficking, secretion, activation, and heparanase-mediated tumor cell migration. Furthermore, partial deletion of this hydrophobic C-terminus region, substitution within the hydrophobic C-terminus region to hydrophilic amino acids, and experiments of single amino acid mutations further point out the importance of the hydrophobic C-terminus region. Therefore, our findings suggest that the hydrophobic C-terminus region of heparanase is a determinant for its intracellular trafficking to the Golgi apparatus, followed by secretion, activation, and tumor cell migration.