The phenotypic resemblance of patients with Costello syndrome and Hurler disease has been linked to impaired formation of elastic fibers that coincides with elevated cellular proliferation. Impaired elastogenesis in these diseases associates with respective abnormal accumulation of chondroitin sulfate and dermatan sulfate proteoglycans that induce cell surface shedding of elastin-binding protein (EBP) normally required for intracellular chaperoning of tropoelastin and its assembly into elastic fibers. A variant of the chondroitin sulfate proteoglycan versican, V3, which lacks chondroitin sulfate, has recently been shown to stimulate elastic fiber assembly and decrease proliferation when expressed by retroviral transduction in arterial smooth muscle cells. However, the mechanism(s) by which V3 influences this phenotype is not known. We now demonstrate that transduction of skin fibroblasts from Costello syndrome and Hurler disease patients with cDNA to versican V3 completely reverses impaired elastogenesis and restores normal proliferation of these cells. This phenotypic reversal is accompanied by loss of chondroitin sulfate from the cell surface and increased levels of EBP. Versican V3 transduction of skin fibroblasts from GM(1)-gangliosidosis patients, which lack EBP, failed to restore impaired elastogenesis. These results suggest that induction of elastic fiber production by gene transfer of versican V3 in skin fibroblasts is mediated by rescue of the tropoelastin chaperone, EBP.