We have used isolated rat liver Golgi membranes to reconstitute the synthesis of sulfated glycosaminoglycans (GAGs) onto the membrane-permeable, external acceptor xyloside. Biosynthetic labeling of GAGs with [ 35 S]sulfate in vitro is shown to have an absolute requirement for ATP and cytosolic proteins and is inhibited by dismantling the Golgi apparatus with okadaic acid or under mitotic conditions suggesting that intercompartmental transport between Golgi cisternae is a prerequisite for the successful completion of the initiation, polymerization, and sulfation of GAGs. Accordingly, we show that in vitro synthesis of 35 S-GAGs utilizes the same machinery employed in Golgi transport events in terms of vesicle budding (ADP-ribosylation factor and coatomer), docking (Rabs), targeting (SNAREs), and fusion (N-ethylmaleimide-sensitive factor). This provides compelling evidence that GAGs synthesis is linked to Golgi membrane traffic and suggests that it can be used as a complementation-independent method to study membrane transport in Golgi preparations from any source. We have applied this system to show that intra-Golgi traffic requires the function of the Golgi target-SNARE, syntaxin 5.