Matrix metalloproteinase 3 cleaves insulin-like growth factor-binding protein-3 (IGFBP-3) into six fragments, four of which bind heparin-Sepharose (Fowlkes, J. L., Enghild, J. J., Suzuki, K., and Nagase, H. (1994) J. Biol. Chem. 269, 25742-25746). Sequence analysis of IGFBP-3 heparin-binding fragments shows that all fragments contain at least one of two highly basic, putative heparin-binding consensus sequences present in IGFBP-3. Epitope-specific antibodies generated against synthetic peptides containing these domains recognized IGFBP-3, yet were significantly inhibited from binding in the presence of heparin, demonstrating that these regions of IGFBP-3 contain functional heparin-binding domains. IGFBP-3 peptides containing one of the two heparin-binding consensus sequences bound heparin in a solid phase binding assay in a dose-dependent and saturable manner. However, the IGFBP-3 peptide containing the heparin-binding consensus sequence 149KKGHA153 bound heparin with approximately 4-fold less affinity than the IGFBP-3 peptide containing the longer heparin-binding consensus sequence 219YKKKQCRP226. Examination of several well characterized glycosaminoglycans to inhibit the binding of heparin to both heparin-binding IGFBP-3 peptides revealed that the most potent inhibitors were heparin, heparan sulfate, and dermatan sulfate; chondroitin sulfate A and hyaluronic acid were intermediate in their inhibitory activities; and chondroitin sulfate C caused no inhibition. These studies identify and characterize the glycosaminoglycan-binding domains in IGFBP-3, providing a basis for the better understanding of IGFBP-3-glycosaminoglycan interactions at the cellular and extracellular interface.