Thrombin (T) inactivation by the serpin, heparin cofactor II (HCII), is accelerated by the glycosaminoglycans (GAGs) dermatan sulfate (DS) and heparin (H). Equilibrium binding and thrombin inactivation kinetics at pH 7.8 and ionic strength (I) 0.125 m demonstrated that DS and heparin bound much tighter to thrombin (K(T(DS)) 1-5.8 microm; K(T(H)) 0.02-0.2 microm) than to HCII (K(HCII(DS)) 236-291 microm; K(HCII(H)) 25-35 microm), favoring formation of T.GAG over HCII.GAG complexes as intermediates for T.GAG.HCII complex assembly. At [GAG] << K(HCII(GAG)) the GAG and HCII concentration dependences of the first-order inactivation rate constants (k(app)) were hyperbolic, reflecting saturation of T.GAG complex and formation of the T.GAG.HCII complex from T.GAG and free HCII, respectively. At [GAG] >> K(HCII(GAG)), HCII.GAG complex formation caused a decrease in k(app). The bell-shaped logarithmic GAG dependences fit an obligatory template mechanism in which free HCII binds GAG in the T.GAG complex. DS and heparin bound fluorescently labeled meizothrombin(des-fragment 1) (MzT(-F1)) with K(MzT(-F1)(GAG)) 10 and 20 microm, respectively, demonstrating a binding site outside of exosite II. Exosite II ligands did not attenuate the DS-accelerated thrombin inactivation markedly, but DS displaced thrombin from heparin-Sepharose, suggesting that DS and heparin share a restricted binding site in or nearby exosite II, in addition to binding outside exosite II. Both T.DS and MzT(-F1).DS interactions were saturable at DS concentrations substantially below K(HCII(DS)), consistent with DS bridging T.DS and free HCII. The results suggest that GAG template action facilitates ternary complex formation and accommodates HCII binding to GAG and thrombin exosite I in the ternary complex.