Syndecan-1 (CD138), a cell-surface heparan sulfate proteoglycan, is involved in cell–cell, cell-matrix interaction and growth factor binding. Loss of expression of syndecan-1 in tumor cells leads to decreased intercellular cohesion, increased potential for tumor invasiveness, and metastatic spread. Furthermore, induction of syndecan-1 expression in the tumor stroma has been postulated to promote tumor angiogenesis via its binding to growth factors such as basic fibroblast growth factor. Although syndecan-1 expression within tumor cells has been investigated in head and neck squamous cell carcinoma, stromal expression has not been studied in detail. We analyzed 38 cases of head and neck squamous cell carcinoma by immunohistochemical staining for syndecan-1 expression within the stroma. The expression of syndecan-1 within tumor cells of various histologic grades of differentiation, squamous cell carcinoma in situ cells, and benign squamous epithelium was also determined. Variable levels of diminished syndecan-1 expression were noted within the dysplastic cells of 9 of 16 (60%) squamous cell carcinoma in situ lesions and in all 38 (100%) invasive squamous cell carcinoma. In general, higher levels of syndecan-1 expression were observed in the well-differentiated tumors, in contrast to significant reduction of expression seen in poorly differentiated tumors. Syndecan-1 expression was observed within the stroma (in fibroblasts) surrounding infiltrating carcinoma cells in 28 of 38 (74%) cases. The intensity of syndecan-1 staining within the stroma showed generally an inverse correlation with the degree of tumor cell differentiation. Syndecan-1 expression was not detected in the stroma beneath normal squamous epithelium or adjacent to areas of squamous cell carcinoma in situ. We conclude that induced expression of syndecan-1 in the stroma surrounding tumor cells of invasive head and neck squamous cell carcinoma is a frequent event. The increased stromal syndecan-1 expression, coupled with its loss from the surface of carcinoma cells, may contribute to tumor cell invasion and the development of metastases.