Proteoglycan (PG) biosynthesis in vivo and PG-associated neurite growth promoting activity in vitro were examined in the thoracic spinal cord of embryonic chick at times during which functional recovery following axonal damage is permitted, and at later times when such functional recovery is restricted. Over a 10-day period encompassing the permissive and restrictive periods the ratio of newly synthesized heparan sulfate (HS) PG: to chondroitin sulfate (CS) PC; decreased by more than 50%. Specific PG-associated neurite promoting activity (NPA) of a PG fraction immobilized on a laminin substrate was 75-fold higher at E9 than at E17. Perturbations of the two families of PGs indicated that all laminin-bound NPA was associated with HSPGs from E9 cord, and that removal of the influence of CSPGs from PG extracts of E17 cord unmasked neurite promoting activity on a poly-D-lysine substrate of the same magnitude as that observed on a laminin substrate. Neurite-promoting activity associated with HSPGs and high HS to CS ratios of newly synthesized PGs characterize the permissive period for axonal regeneration in the chick embryo spinal cord. In the restrictive period for axonal regeneration neurite promoting activity is masked by the presence of CSPGs which are synthesized at higher levels than HSPGs. (C) 1994 Academic Press, Inc.