The pathological scaling in recessive x-linked ichthyosis is associated with accumulation of abnormal quantities of cholesterol sulfate in stratum corneum (J. Clin. Invest. 68:1404-1410, 1981). To determine whether or not cholesterol sulfate accumulates in recessive x-linked ichthyosis as a direct result of the missing enzyme, steroid sulfatase, we quantitated both steroid sulfatase and its substrate, we quantitated both steroid sulfatase and its substrate, cholesterol sulfate, in different epidermal strata, as well as within stratum corneum subcellular fractions obtained from normal human and neonatal mouse epidermis and from patients with recessive x-linked ichthyosis. In normal human and mouse epidermis, steroid sulfatase activity peaked in the stratum granulosum and stratum corneum, and negligible activity was detectable in lower epidermal layers. In contrast, in recessive x-linked ichthyosis epidermis, enzyme levels were virtually undetectable at all levels. In normal human stratum corneum, up to 10 times more steroid sulfatase activity was present in purified peripheral membrane preparations than in the whole tissue. Whereas in normal human epidermis cholesterol sulfate levels were lowest in the basal/spinous layer, and highest in the stratum granulosum, in recessive x-linked ichthyosis the levels were only slightly higher in the lower epidermis, but continued to climb in the stratum corneum. In both normal and in recessive x-linked ichthyosis stratum corneum, cholesterol sulfate appeared primarily within membrane domains, paralleling the pattern of steroid sulfatase localization. Finally, the role of excess cholesterol sulfate in the pathogenesis of recessive x-linked ichthyosis was directly tested by topical applications of this substance, which produced visible scaling in hairless mice in parallel to an increased cholesterol sulfate content of the stratum corneum. These results demonstrate an intimate relationship between steroid sulfatase and cholesterol sulfate in normal epidermis: both are concentrated in the outer epidermis (stratum corneum and stratum granulosum), and both are localized to membrane domains. Presumably, as a result of this distribution pattern, continued enzymatic degradation of substrate occurs in normal epidermis, thereby preventing excessive accumulation of cholesterol sulfate. In contrast, in recessive x-linked ichthyosis, degradation of cholesterol sulfate does not occur and cholesterol sulfate accumulates specifically in the stratum corneum, where it produces visible scale.