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• Expression of Hpa2 is markedly induced by stress. • Hpa2 induction by stress is mediated by ATF3. • High levels of Hpa2 and ATF3 are associated with longer survival of cancer patients. Activity of heparanase, endoglycosidase that cleaves heparan sulfate side chains in heparan sulfate proteoglycans, is highly implicated in tumor progression and metastasis. Heparanase inhibitors are therefore being evaluated clinically as anti-cancer therapeutics. Heparanase 2 (Hpa2) is a close homolog of heparanase that lacks HS-degrading activity and functions as an endogenous inhibitor of heparanase. As a result, Hpa2 appears to attenuate tumor growth but mechanisms that regulate Hpa2 expression and determine the ratio between heparanase and Hpa2 are largely unknown. We have recently reported that the expression of Hpa2 is induced by endoplasmic reticulum (ER) and proteotoxic stresses, but the mechanism(s) underlying Hpa2 gene regulation was obscure. Here we expand the notion that Hpa2 is regulated by conditions of stress. We report that while ER and hypoxia, each alone, resulted in a 3-7 fold increase in Hpa2 expression, combining ER stress and hypoxia resulted in a noticeable, over 40-fold increase in Hpa2 expression. A prominent induction of Hpa2 expression was also quantified in cells exposed to heat shock, proteotoxic stress, lysosomal stress, and chemotherapy (cisplatin), strongly implying that Hpa2 is regulated by conditions of stress. Furthermore, analyses of the Hpa2 gene promoter led to the identification of activating-transcription-factor 3 (ATF3) as a transcription factor that mediates Hpa2 induction by stress, thus revealing, for the first time, a molecular mechanism that underlies Hpa2 gene regulation. Induction of Hpa2 and ATF3 by conditions of stress that often accompany the rapid expansion of tumors is likely translated to improved survival of cancer patients. [ABSTRACT FROM AUTHOR]