Smooth muscle cell (SMC) proliferation plays a critical role in several pathological states, including atherosclerosis and hypertension. Heparin suppresses SMC proliferation in vivo and in culture, but the mechanism of action is still poorly understood. In an accompanying article in this issue (Letourneur et al. [1995] J. Cell Physiol., 165:676-686), we observed that heparin binding was up-regulated in heparin-sensitive SMC but was rapidly down-regulated in heparin-resistant SMC continuously exposed to heparin. In this communication, we examine the degradation and secretion of internalized heparin in sensitive and resistant SMC, using gel filtration chromatography to analyze heparin degradation products. Pulse-chase experiments using radiolabeled heparin indicate that sensitive and resistant SMC secrete heparin during the first few hours after exposure. Experiments in which cells are continuously exposed to heparin indicate that degradation and secretion occur in both sensitive and resistant SMC for approximately 5-8 hr. After that time, however, binding and internalization in resistant SMC rapidly decrease and degradation and secretion stop. In contrast, heparin binding and uptake continue in sensitive SMC; degradation and secretion also continue. Chloroquine prevents degradation in both sensitive and resistant SMC, suggesting that catabolism occurs in the lysosomal compartment. The results presented in this and the accompanying article (Letourneur et al. [1995] J. Cell. Physiol., 165:676-686) suggest that heparin acts to upregulate its receptors, and that increased binding of heparin is required for the antiproliferative response. Degradation and secretion kinetics parallel the internalization kinetics and appear to be strongly linked to the binding process.