Previous studies have demonstrated that protein C (PC) can be activated by factor Xa (fXa) in a reaction that requires Ca2+ and negatively-charged phospholipid. Sulfated polysaccharides, such as heparin or dextran sulfate, have been shown to accelerate this reaction, although their mechanism of action remains elusive. To further explore this phenomenon, we first examined the effect of glycosaminoglycans of varying degrees of sulfation on the kinetics of PC activation by fXa in the presence of Ca2+ and phosphatidylcholine-phosphatidylserine vesicles (75%/25% w/w). Heparin increased the rate PC activation in a concentration-dependent and saturable fashion producing a 4-fold increase in catalytic efficiency (kcat/Km of 105 M−1 min−1) by reducing the Km for the reaction. In contrast N-desulfated heparin had no effect on the rate of this reaction, whereas dextran sulfate, which is more sulfated than heparin, increased the catalytic efficiency 21-fold. These data suggest that the capacity of glycosaminoglycans to catalyze PC activation by fXa is dependent on their degree of sulfation. The extent of sulfation is more important than chain length because hypersulfated low-molecular-weight heparin (HSLMWH) and dextran sulfate, both of which have a mean molecular weight of 5000, increased the catalytic efficiency 16- and 21-fold respectively. In contrast, enoxaparin, which also has a mean molecular weight of about 5000, had little effect. The capacity of heparin to enhance PC activation by fXa is similar in the presence of factor Va as it is in its absence, suggesting that heparin can accelerate this reaction even when fXa is incorporated within the prothrombinase complex. To begin to explore the mechanism by which these glycosaminoglycans enhance PC activation by fXa, we measured their affinities for PC and fXa, both of which have heparin-binding domains, in the presence of Ca2+. This was performed by monitoring changes in extrinsic fluorescence of fluorescein-labeled fXa or PC after addition of glycosaminoglycan. Heparin binds PC with similar affinity in the absence or presence of negatively-charged phospholipid (Kd values of 1.9 and 1.0 mM, respectively). In contrast, heparin binds fXa with 86-fold higher affinity in the presence of phospholipid vesicles than in its absence (Kd values of.007 and 0.61 mM, respectively). These findings suggest that fXa binding to phospholipid exposes a high-affinity heparin-binding site. In the absence of phospholipid, more sulfated glycosaminoglycans (dextran sulfate and HSLMWH) bind fXa with 2- to 3-fold higher affinity than heparin. These compounds exhibit a smaller increase in affinity for PC. These observations suggest that the capacity of glycosaminoglycans to enhance PC activation is dependent on the extent of sulfation, a feature that determines their affinity for fXa. How glycosaminoglycan binding to fXa modulates this reaction is uncertain, but it is more likely to reflect conformational changes in the enzyme than bridging of the enzyme to the substrate.