Heparin is a potent inhibitor of the proliferation and migration of vascular smooth muscle cells. This agent selectively inhibits the transcription of tissue-type plasminogen activator and interstitial collagenase, probably by decreasing the binding of activator protein-1 (AP-1) to phorbol ester-responsive elements in the promoters of these genes. Decreased AP-1 binding is not due to a direct inhibition by heparin, since heparinase digestion of nuclear extracts prepared from heparin-treated smooth muscle cells does not restore AP-1 binding activity. Treatment of cells with heparin suppresses the expression of Jun B, one of the components of AP-1. The major effect of heparin is at the level of posttranslational modification of Jun B. Results from pulse-chase labeling experiments show that the newly synthesized Jun B is rapidly converted to a higher-molecular-weight form and that conversion is suppressed by heparin. Evidence is presented suggesting that the heparin-inhibited event is phosphorylation of Jun B.