It has been shown that shear stress plays a critical role in promoting endothelial cell (EC) differentiation from embryonic stem cell (ESC)-derived EC. However, the underlying mechanisms mediating shear stress effects in this process have yet to be determined. It has been reported that the glycocalyx component heparan sulfate proteoglycan (HSPG) mediates shear stress mechanotransduction in mature EC. In this study, we investigated whether cell surface HSPG plays a role in shear stress modulation of EC phenotype. ESC-derived endothelial cells were subjected to shear stress (5 dyn/cm2) for 8 hours with or without heparinase III (Hep III) that digests heparan sulfate. Immunostaining showed that ESC-derived EC surfaces contain abundant HSPG, which could be cleaved by Hep III (see figure below). We observed that shear stress significantly increased the expression of vascular endothelial cell-specific marker genes (vWF, VE-cadherin, PECAM-1). The effect of shear stress on expression of tight junction protein genes (ZO-1, OCLD, CLD5) was also evaluated. Shear stress increased the expression of ZO-1 and CLD5, while it didn’t alter the expression of OCLD. Shear stress increased expression of vasodilatory genes (eNOS, COX-2), while it decreased the expression of the vasoconstrictive gene ET1. After reduction of HSPG with Hep III, the shear stress-induced expression of vWF, VE-cadherin, ZO-1, eNOS, and COX-2, were abolished, suggesting that shear stress-induced expression of these genes depends on HSPG. These findings indicate for the first time that HSPG is a mechanosensor mediating shear stress-induced EC differentiation from ESC-derived EC cells.