The major goal of this R21 proposal is to explore the role of syndecan-1 in the attenuation of lung injury and inflammation by mesenchymal stem cells (MSCs). MSCs have several properties that make them attractive candidates for cell-based therapies of acute and chronic diseases. MSCs can be isolated from the bone marrow and the connective tissue of almost all organs, can be expanded in vitro, are considered to be non-immunogenic, and they possess potent immunosuppressive, mitogenic, angiogenic, anti-apoptotic, and antimicrobial activities. MSCs are thought to function primarily in a paracrine manner, and conditioned medium from MSCs has been shown to attenuate tissue injury and inflammation, adding to the therapeutic potential of MSCs. However, the underlying mechanisms of how MSCs protect against tissue injury and promote repair is largely unknown. Furthermore, there are no definitive markers for MSCs and the efficacy of MSCs varies considerably among subpopulations, which may explain the suboptimal outcomes in several clinical studies. It is therefore imperative to identify specific markers that reflect the therapeutic efficacy of MSCs and to determine how MSC activities are regulated in vivo. We examined whether syndecan-1 regulates the ability of MSCs to differentiate and to attenuate lung injury in mice. Syndecan-1 is a major cell surface heparan sulfate proteoglycan (HSPG) that has been shown to bind and regulate many factors implicated in tissue injury and repair, such as cytokines, growth factors, and ECM components. Syndecan-1 functions as a receptor for HS- binding molecules on the cell surface and as a regulator of molecular interactions in the extracellular environment as soluble, intact HSPG ectodomains released by shedding. Our preliminary studies indicated that Sdc1 does not affect the attachment and proliferation of MSCs on plastic, expression of known markers of MSCs, or the ability of isolated MSCs to transdifferentiate. However, syndecan-1 ablation significantly inhibited the ability of MSCs to inhibit LPS-induced lung injury. Based on these data, we will explore the hypotheses that syndecan-1 expression is associated with the therapeutic efficacy of MSCs in acute lung diseases, and that syndecan-1 mediates the anti-inflammatory activities of MSCs. We will test these hypotheses in 2 specific aims. Aim 1 will establish that syndecan-1 expression reflects the potency of MSCs to attenuate lung injury and aim 2 will explore the underlying biological mechanisms of how syndecan-1 expressing MSCs inhibit lung injury. These studies are expected to identify molecules and pathways that can be targeted to improve the therapeutic efficacy of MSCs in the treatment of acute lung diseases.