Follistatin associates with transforming growth factor--like growth factors such as activin or bone morphogenetic proteins to form an inactive complex, thereby regulating processes as diverse as embryonic development and cell secretion. Although an interaction between heparan sulfate chains present at the cell surface and follistatin has been recorded, the impact of this binding reaction on the follistatin-mediated inhibition of transforming growth factor--like signaling remains unclear. To gain a structural insight into this interaction, we have solved the crystal structure of the presumed heparan sulfate-binding domain of follistatin, both alone and in complex with the small heparin analogs sucrose octasulfate and D-myo-inositol hexasulfate. In addition, we have confirmed the binding of the sucrose octasulfate and D-myo-inositol hexasulfate molecules to this follistatin domain and determined the association constants and stoichiometries of both interactions in solution using isothermal titration calorimetry. Overall, our results shed light upon the structure of this follistatin domain and reveal a novel conformation for a hinge region connecting epidermal growth factor-like and Kazal-like subdomains compared with the follistatin-like domain found in the extracellular matrix protein BM-40. Moreover, the crystallographic analysis of the two protein-ligand complexes mentioned above leads us to propose a potential location for the heparan sulfate-binding site on the surface of follistatin and to suggest the involvement of residues Asn 80 and Arg 86 in such a follistatin-heparin interaction.The secreted polypeptide follistatin regulates several signaling pathways in a cell-and tissue-specific manner, largely through its ability to inactivate transforming growth factor--like growth factor molecules (1, 2). Although first identified as a factor capable of countering the inducing effects of activin on follicle-stimulating hormone secretion (3, 4), follistatin has now been isolated and characterized from a variety of tissues and organisms, where it has been shown to take part in processes such as cell growth, differentiation, and secretion (5-7). Moreover, the importance of this polypeptide has been demonstrated in follistatin-null mice, which can survive birth but die from multiple skeletal and cutaneous abnormalities within a few hours of delivery (8).Follistatin isoforms sharing the same N terminus but differing in the length of their polypeptide chain and in their glycosylation patterns coexist in vivo, with molecular masses ranging from 31 to 39 kDa (4, 9). Indeed, alternative splicing of the follistatin gene yields the Fs-315 and Fs-288 isoforms, featuring 315 and 288 residues, respectively. An additional variant of follistatin, Fs-303, is thought to arise from the proteolytic cleavage of the Fs-315 C terminus and is likely to be the predominant species in vivo (3, 10, 11). Despite its relatively limited size, follistatin contains a total of 36 cysteine residues, believed to be arranged into nonoverlapping set...