Heparin-binding growth factor-1 (HBGF-1) is an angiogenic polypeptide mitogen for mesoderm- and neuroectoderm-derived cells in vitro and remains biologically active after truncation of the amino-terminal domain (HBGF-1 alpha) of the HBGF-1 beta precursor. Polymerase chain reaction mutagenesis and prokaryotic expression systems were used to prepare a mutant of HBGF-1 alpha lacking a putative nuclear translocation sequence (amino acid residues 21 to 27; HBGF-1U). Although HBGF-1U retains its ability to bind to heparin, HBGF-1U fails to induce DNA synthesis and cell proliferation at concentrations sufficient to induce intracellular receptor-mediated tyrosine phosphorylation and c-fos expression. Attachment of the nuclear translocation sequence from yeast histone 2B at the amino terminus of HBGF-1U yields a chimeric polypeptide (HBGF-1U2) with mitogenic activity in vitro and indicates that nuclear translocation is important for this biological response.