SPARC is a transiently expressed extracellular matrix-binding protein that alters cell shape and regulates endothelial cell proliferation in vitro. In this study, we show that SPARC mRNA and protein are synthesized by endothelial cells during angiogenesis in vivo. SPARC and peptides derived from a cationic region of the protein (amino acids 113-130) stimulated the formation of endothelial cords in vitro; moreover, these peptides stimulated angiogenesis in vivo. Mapping of the active domain demonstrated that the sequence KGHK was responsible for most of the angiogenic activity; substitution of the His residue decreased the effect. We found that proteolysis of SPARC provided a source of KGHK, GHK, and longer peptides that contained these sequences. Although the Cu(2+)-GHK complex had been identified as a mitogen/morphogen in normal human plasma, we found KGHK and longer peptides to be potent stimulators of angiogenesis. SPARC113-130 and KGHK were shown to bind Cu2+ with high affinity; however, previous incubation with Cu2+ was not required for the stimulatory activity. Since a peptide from a second cationic region of SPARC (SPARC54-73) also bound Cu2+ but had no effect on angiogenesis, the angiogenic activity appeared to be sequence specific and independent of bound Cu2+. Thus, specific degradation of SPARC, a matrix-associated protein expressed by endothelial cells during vascular remodeling, releases a bioactive peptide or peptides, containing the sequence (K)GHK, that could regulate angiogenesis in vivo.