The airway plays a vital role in allergic lung diseases by responding to inhaled allergens and initiating allergic inflammation. Various proinflammatory functions of the airway epithelium have been identified, but, equally important, anti-inflammatory mechanisms must also exist. We show in this study that syndecan-1, the major heparan sulfate proteoglycan of epithelial cells, attenuates allergic lung inflammation. Our results show that syndecan-1-null mice instilled with allergens exhibit exaggerated airway hyperresponsiveness, glycoprotein hypersecretion, eosinophilia, and lung IL-4 responses. However, administration of purified syndecan-1 ectodomains, but not ectodomain core proteins devoid of heparan sulfate, significantly inhibits these inflammatory responses. Furthermore, syndecan-1 ectodomains are shed into the airway when wild-type mice are intranasally instilled with several biochemically distinct inducers of allergic lung inflammation. Our results also show that syndecan-1 ectodomains bind to the CC chemokines (CCL7, CCL11, and CCL17) implicated in allergic diseases, inhibit CC chemokine-mediated T cell migration, and suppress allergen-induced accumulation of Th2 cells in the lung through their heparan sulfate chains. Together, these findings uncover an endogenous anti-inflammatory mechanism of the airway epithelium where syndecan-1 ectodomains attenuate allergic lung inflammation via suppression of CC chemokine-mediated Th2 cell recruitment to the lung.