Apolipoprotein (apo) E mediates lipoprotein remnant clearance via interaction with cell-surface heparan sulfate proteoglycans. Both the 22-kDa N-terminal domain and 10-kDa C-terminal domain of apoE contain a heparin binding site; the N-terminal site overlaps with the low density lipoprotein receptor binding region and the C-terminal site is undefined. To understand the molecular details of the apoE-heparin interaction, we defined the microenvironments of all 12 lysine residues in intact apoE3 and examined their relative contributions to heparin binding. Nuclear magnetic resonance measurements showed that, in apoE3-dimyristoyl phosphatidylcholine discs, Lys-143 and -146 in the N-terminal domain and Lys-233 in the C-terminal domain have unusually low pK(a) values, indicating high positive electrostatic potential around these residues. Binding experiments using heparin-Sepharose gel demonstrated that the lipid-free 10-kDa fragment interacted strongly with heparin and a point mutation K233Q largely abolished the binding, indicating that Lys-233 is involved in heparin binding and that an unusually basic lysine microenvironment is critical for the interaction with heparin. With lipidated apoE3, it is confirmed that the Lys-233 site is completely masked and the N-terminal site mediates heparin binding. In addition, mutations of the two heparin binding sites in intact apoE3 demonstrated the dominant role of the N-terminal site in the heparin binding of apoE even in the lipid-free state. These results suggest that apoE interacts predominately with cell-surface heparan sulfate proteoglycans through the N-terminal binding site. However, Lys-233 may be involved in the binding of apoE to certain cell-surface sites, such as the protein core of biglycan.