Perlecan, a heparan sulfate proteoglycan of basement membranes and cell surfaces, has been implicated in the control of tumor cell growth and metastasis because of its ability to bind and store growth factors and its activity as an inducer of angiogenesis. Because interferon-gamma (IFN-gamma), a cytokine with known antiproliferative and antitumoral activity, binds with high affinity to the heparan sulfate side chains of perlecan, we investigated the activity of IFN-gamma on perlecan gene expression and cell growth in colon carcinoma cells. We found that IFN-gamma rapidly and efficiently blocked perlecan gene expression with concurrent growth suppression, a phenomenon that was independent of a functional p21(WAF1/CIP1). These effects were transcriptionally mediated, did not require new protein synthesis, and were fully reversible. Moreover, we found these IFN-gamma-induced effects to be generalizable because they could be reproduced in a variety of cells with various histogenetic backgrounds. The transcriptional repression of the perlecan gene required intact Stat1 protein, and these effects were likely mediated by Stat1-binding sites in the distal promoter region. Thus, the IFN-gamma-mediated transcriptional repression of perlecan may represent a novel antitumoral effect of this cytokine through which it eliminates a powerful angiogenic stimulus.