It has long been predicted that the members of the hyaluronidase enzyme family have important non-enzymatic functions. However, their nature remains a mystery. The metabolism of hyaluronan (HA), their major enzymatic substrate, is also enigmatic. To examine the function of Hyal2, a glycosylphosphatidylinositol-anchored hyaluronidase with intrinsically weak enzymatic activity, we have compared stably transfected rat fibroblastic BB16 cell lines with various levels of expression of Hyal2. These cell lines continue to express exclusively the standard form (CD44s) of the main HA receptor, CD44. Hyal2, CD44, and one of its main intracellular partners, ezrin-radixin-moesin (ERM), were found to co-immunoprecipitate. Functionally, Hyal2 overexpression was linked to loss of the glycocalyx, the HA-rich pericellular coat. This effect could be mimicked by exposure of BB16 cells either to Streptomyces hyaluronidase, to HA synthesis inhibitors, or to HA oligosaccharides. This led to shedding of CD44, separation of CD44 from ERM, reduction in baseline level of ERM activation, and markedly decreased cell motility (50% reduction in a wound healing assay). The effects of Hyal2 on the pericellular coat and on CD44-ERM interactions were inhibited by treatment with the Na(+)/H(+) exchanger-1 inhibitor ethyl-N-isopropylamiloride. We surmise that Hyal2, through direct interactions with CD44 and possibly some pericellular hyaluronidase activity requiring acidic foci, suppresses the formation or the stability of the glycocalyx, modulates ERM-related cytoskeletal interactions, and diminishes cell motility. These effects may be relevant to the purported in vivo tumor-suppressive activity of Hyal2.