We have used in situ hybridization histochemistry to examine the cellular sites of synthesis of two major nervous tissue proteoglycans, neurocan and phosphacan, in embryonic and postnatal rat brain and spinal cord. Both proteoglycans were detected only in nervous tissue. Neurocan mRNA was evident in neurons, including cerebellar granule cells and Purkinje cells, and in neurons of the hippocampal formation and cerebellar nuclei. In contrast, phosphacan message was detected only in astroglia, such as the Golgi epithelial cells of the cerebellum. At embryonic day 13-16, phosphacan mRNA is largely confined to areas of active cell proliferation (e.g., the ventricular zone of the ganglionic eminence and septal area of the brain and the ependymal layer surrounding the central canal of the spinal cord) as well as being present in the roof plate. The distribution of neurocan message is more widespread, extending to the cortex, hippocampal formation, caudate putamen, and basal telencephalic neuroepithelium, and neurocan mRNA is present in both the ependymal and mantle layers of the spinal cord but not in the roof plate. The presence of neurocan mRNA in areas where the proteoglycan is not expressed suggests that the short open reading frame in the 5'-leader of neurocan may function as a cis-acting regulatory signal for the modulation of neurocan expression in the developing central nervous system.