Mice lacking exon 3 of perlecan (Hspg2) gene were generated by gene targeting. Exon deletion does not alter the expression or the reading frame but causes loss of attachment sites for three heparan sulfate (HS) side chains. Hspg2 Δ3/Δ3 mice are viable and fertile but have small eyes. Apoptosis and leakage of cellular material through the lens capsule are observed in neonatal lenses, and lenses degenerate within 3 weeks of birth. Electron microscopy revealed altered structure of the lens capsule through which cells had formed extensions. No kidney malfunction, such as protein uria, was detected in Hspg2 Δ3/Δ3 mutant mice, nor were ultrastructural changes observed in the glomerular basement membranes (BMs). To achieve further depletion in the HS content of the BMs, Hspg2 Δ3/Δ3 mice were bred with collagen XVIII null mice. Lens defects were more severe in the newborn Col18a1−/−× Hspg2 Δ3/Δ3 mice and degeneration proceeded faster than in Hspg2 Δ3/Δ3 mice. The results suggest that in the lens capsule, HS chains have a structural function and are essential in the insulation of the lens from its environment and in regulation of incoming signals.