The Drosophila lipoprotein particle, Lipophorin, bears lipid-linked morphogens on its surface and is required for long-range signaling activity of Wingless and Hedgehog. Heparan sulfate proteoglycans are also critical for trafficking and signaling of these morphogens. Here we show that Lipophorin interacts with the heparan sulfate moieties of the glypicans Daily and Daily-like. Membrane-associated glypicans can recruit Lipophorin to disc tissue, and remain associated with these, particles after they are released from the membrane by cleavage of their gpi anchors. The released form of Daily colocalizes with Patched, Hedgehog, and Lipophorin in endosomes and increases Hedgehog signaling efficiency without affecting its distribution. These data suggest that heparan sulfate proteoglycans may influence lipid-linked morphogen signaling, at least in part, by binding to Lipophorin. They further suggest that the complement of proteins present on lipoprotein particles can regulate the activity of morphogens.
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