Branching morphogenesis and chondroitin sulfate proteoglycan synthesis by explanted fetal mouse kidneys were previously shown to be inhibited by p-nitrophenyl beta-D-xylopyranoside (beta-D-xyloside) while glomerular development and heparan sulfate proteoglycan synthesis were unaffected. The metabolic fate of fetal kidney explant proteoglycans was investigated to determine whether or not recovery of proteoglycan synthesis and morphogenesis occur after exposure to beta-D-xyloside. Chondroitin sulfate proteoglycan synthesis resumed within 4 hr of removal of beta-D-xyloside and was enhanced once beta-D-xyloside-initiated chondroitin/dermatan-35SO4 glycosaminoglycans (GAGs) were released from the tissue. Radioactivity incorporated into beta-D-xyloside-initiated chondroitin/dermatan-35SO4 GAGs during labeling in the presence of beta-D-xyloside was reutilized in the synthesis of chondroitin-35SO4 proteoglycan during a 24-hr chase in nonradioactive medium without beta-D-xyloside. Further, highly purified beta-D-xyloside-initiated chondroitin/dermatan-35SO4 GAGs were taken up by kidneys more avidly than was free [35S]sulfate. These 35S-GAGs were degraded and reutilized in the synthesis of chondroitin-35SO4 proteoglycan. Ureteric bud branching resumed 48 hr after beta-D-xyloside was removed from the incubation medium. These findings support the idea that both chondroitin sulfate proteoglycan synthesis and proteoglycan processing may be involved in branching morphogenesis.