Germline mutations in the Exostoses-1 gene (EXT1) are found in hereditary multiple exostoses syndrome, which is characterized by the formation of osteochondromas and an increased risk of chondrosarcomas and osteosarcomas. However, despite its putative tumor-suppressor function, little is known of the contribution of EXT1 to human sporadic malignancies. Here, we report that EXT1 function is abrogated in human cancer cells by transcriptional silencing associated with CpG island promoter hypermethylation. We also show that, at the biochemical and cellular levels, the epigenetic inactivation of EXT1, a glycosyltransferase, leads to the loss of heparan sulfate (HS) synthesis. Reduced HS production can be reversed by the use of a DNA demethylating agent. Furthermore, the re-introduction of EXT1 into cancer cell lines displaying methylation-dependent silencing of EXT1 induces tumor-suppressor-like features, e.g. reduced colony formation density and tumor growth in nude mouse xenograft models. Screening a large collection of human cancer cell lines (n=79) and primary tumors (n=454) from different cell types, we found that EXT1 CpG island hypermethylation was common in leukemia, especially acute promyelocytic leukemia and acute lymphoblastic leukemia, and non-melanoma skin cancer. These findings highlight the importance of EXT1 epigenetic inactivation, leading to an abrogation of HS biosynthesis, in the processes of tumor onset and progression.