We previously demonstrated a unique alpha-N-acetylgalactosaminyltransferase that transferred N-acetylgalactosamine (GalNAc) to the tetrasaccharide-serine, GlcAbeta1-3Galbeta1-3Galbeta1-4Xylbeta1-O-Ser (GlcA represents glucuronic acid), derived from the common glycosaminoglycan-protein linkage region, through an alpha1,4-linkage. In this study, we purified the enzyme from the serum-free culture medium of a human sarcoma cell line. Peptide sequence analysis of the purified enzyme revealed 100% identity to the multiple exostoses-like gene EXTL2/EXTR2, a member of the hereditary multiple exostoses (EXT) gene family of tumor suppressors. The expression of a soluble recombinant form of the protein produced an active enzyme, which transferred alpha-GalNAc from UDP-[3H]GalNAc to various acceptor substrates including GlcAbeta1-3Galbeta1-3Galbeta1-4Xylbeta1-O-Ser. Interestingly, the enzyme also catalyzed the transfer of N-acetylglucosamine (GlcNAc) from UDP-[3H]GlcNAc to GlcAbeta1-3Galbeta1-O-naphthalenemethanol, which was the acceptor substrate for the previously described GlcNAc transferase I involved in the biosynthetic initiation of heparan sulfate. The GlcNAc transferase reaction product was sensitive to the action of heparitinase I, establishing the identity of the enzyme to be alpha1, 4-GlcNAc transferase. These results altogether indicate that EXTL2/EXTR2 encodes the alpha1,4-N-acetylhexosaminyltransferase that transfers GalNAc/GlcNAc to the tetrasaccharide representing the common glycosaminoglycan-protein linkage region and that is most likely the critical enzyme that determines and initiates the heparin/heparan sulfate synthesis, separating it from the chondroitin sulfate/dermatan sulfate synthesis.