Persistent proteolytic imbalance in chronic inflammatory diseases has been ascribed to neutrophil elastase (NE)/antielastase imbalance in wound fluids. In sputum sols of patients with bronchiectasis, we found unopposed NE activity, despite overwhelming excess of the physiological antielastase, alpha(1)-antitrypsin (alpha(1)-AT). Western blot analysis found NE in a supramolecular complex with shed ectodomains of syndecan (Syn)-1 in sputum sol samples and, as such, inhibition of NE activity was incomplete, even with addition of exogenous alpha(1)-AT. To confirm that NE binding to heparan sulfate (HS) components of Syn-1 limits the antielastase effect, recombinant human Syn-1 was recovered from stable Syn-1 transfectants of a human B-lymphoid cell line (ARH-77). Western ligand blot confirmed that NE bound to HS moieties and alpha(1)-AT to the core protein of the recombinant product. Inhibition of NE activity by standard additions of alpha(1)-AT was incomplete unless Syn-1 had been deglycanated by heparitinase treatment. Surface plasmon resonance analysis revealed that NE binding to HS (equilibrium dissociation constant, approximately 14 nM) could be outcompeted by heparin variants. We conclude that the HS moiety of shed Syn-1 binds and restricts NE from inhibition by alpha(1)-AT.