Sulfated glycoconjugates were ultrastructurally localized within embryonic chick marrow by using the high iron diamine-silver proteinate stain. Stain was concentrated in the extravascular, granulopoietic compartment, indicating that granulopoiesis, but not erythropoiesis, proceeded in a highly sulfated environment. It was likely that most of the stainable material represented sulfated proteoglycans since staining was abrogated by predigesting tissue with enzymes and other treatments known to degrade specific glycosaminoglycan chains. Chondroitinase/hyaluronidase digestion resulted in the removal of most of the stainable material associated with the extracellular matrix and a portion of the stainable material associated with fibroblastic cell surfaces. Unaffected material lay in close proximity to fibroblastic cell membranes. Heparitinase/heparinase digestion had essentially the opposite effect. Sulfated material associated with matrix components was largely unaffected, but the fibroblastic plasmalemmal material was now absent. These results suggest that there are at least two categories of sulfated proteoglycans in the granulopoietic compartment, each differentially distributed. The plasmalemmal material likely represented heparan sulfate which in this tissue appeared to be associated in a uniform layer with fibroblastic stromal cell membranes and not with blood or endothelial cell membranes. Material identified as chondroitin sulfates was found within patches of amorphous matrix that was located on fibroblastic stromal cell surfaces and that was interspersed with fibrils in the extracellular matrix. Chondroitin sulfates were sparsely distributed on granulocytic cell surfaces.