Decorin is a small proteoglycan that is ubiquitous in the extracellular matrix of mammalian tissues. It has been extensively demonstrated that decorin inhibits tumor cell growth; however, no data have been reported on the effects of decorin in normal cells. Using nontransformed macrophages from bone marrow, results of this study showed that decorin inhibits macrophage colony-stimulating factor (M-CSF)-dependent proliferation by inducing blockage at the G(1) phase of the cell cycle without affecting cell viability. In addition, decorin rescues macrophages from the induction of apoptosis after growth factor withdrawal. Decorin induces the expression of the cdk inhibitors p21(Waf1) and p27(Kip1). Using macrophages from mice where these genes have been disrupted, inhibition of proliferation mediated by decorin is related to p27(Kip1) expression, whereas p21(Waf1) expression is necessary to protect macrophages from apoptosis. Decorin also inhibits M-CSF-dependent expression of MKP-1 and extends the kinetics of ERK activity, which is characteristic when macrophages become activated instead of proliferating. The effect of decorin on macrophages is not due to its interaction with epidermal growth factor or interferon-gamma receptors. Furthermore, decorin increases macrophage adhesion to the extracellular matrix, and this may be partially responsible for the expression of p27(Kip1) and the modification of ERK activity, but not for the increased cell survival.