The catabolism of newly synthesized decorin by explant cultures of bovine collateral ligament was investigated. The tissue was placed in explant culture for 6 days then incubated with radiolabeled sulfate for 6 h and replaced in culture for 5 days to allow for the loss of the radiolabeled large proteoglycan. The metabolic fate of the remaining radiolabeled decorin present in the matrix of the tissue over the next 9-day period was determined. It was shown that this pool of decorin was lost from ligament explant cultures either directly into the culture medium or taken up and degraded within the cells of the tissue. The intracellular degradation of the radiolabeled pool of decorin by ligament explant cultures was shown to result in the generation of [35S]sulfate. This process required metabolically active cells and involved the lysosomal system since sulfate generation was inhibited when cultures were maintained at 4 degrees C or in the presence of either 10 mM ammonium chloride or 0. 05 mM chloroquine. The inhibition of intracellular processing of decorin resulted in an increase in the rate of loss of this proteoglycan into the medium of the cultures. The inhibition of intracellular degradation of decorin was reversible on incubation of the explant cultures at 37 degrees C or removal of ammonium chloride from the culture medium. After removal of the ammonium chloride from the culture medium the rate of intracellular catabolism was greater than that observed in cultures maintained in medium alone, which suggested that there was an intracellular accumulation of native and/or partially degraded material within the cells.