PG-Lb is a small dermatan sulfate proteoglycan that has been previously characterized in chicken. In the developing limb, chick PG-Lb appears to be exclusively expressed in the zone of flattened chondrocytes. We have cloned and sequenced the human homolog to chick PG-Lb from two human chondrocyte cDNA libraries and a human chondrocyte RNA sample. The human homolog has been named DSPG3, as it is the third member of the small dermatan sulfate proteoglycan family to be identified and characterized along with biglycan (PG-I) and decorin (PG-II). DSPG3 maps to chromosome 12q21 and is composed of 1515 nucleotides of cDNA that code for a 322-amino-acid protein. The protein contains three potential glycosaminoglycan attachment sites, two N-glycosylation sites, a poly- glutamic acid stretch, and six cysteines. By Northern analysis, we have demonstrated that DSPG3 is expressed in cartilage, as well as ligament and placental tissues.