Intrinsic and extrinsic signals as well as the extracellular matrix (ECM) tightly regulate stem cells for tissue homeostasis and regenerative capacity. Little is known about the regulation of tissue homeostasis by the ECM. Heparan sulfate proteoglycans (HSPGs), important components of the ECM, are involved in a variety of biological events. Two heparin sulfate 3-O sulfotransferase (Hs3st) genes, Hs3st-A and Hs3st-B, encode the modification enzymes in heparan sulfate (HS) biosynthesis. Here we demonstrate that Hs3st-A and Hs3st-B are required for adult midgut homeostasis. Depletion of Hs3st-A in enterocytes (ECs) results in increased intestinal stem cell (ISC) proliferation and tissue homeostasis loss. Moreover, increased ISC proliferation is also observed in Hs3st-B null mutant alone, or in combination with Hs3st-A RNAi. Hs3st-A depletion-induced ISC proliferation is effectively suppressed by simultaneous inhibition of the EGFR signaling pathway, suggesting that tissue homeostasis loss in Hs3st-A-deficient intestines is due to increased EGFR signaling. Furthermore, we find that Hs3st-A-depleted ECs are unhealthy and prone to death, while ectopic expression of the antiapoptotic p35 is able to greatly suppress tissue homeostasis loss in these intestines. Together, our data suggest that Drosophila Hs3st-A and Hs3st-B are involved in the regulation of ISC proliferation and midgut homeostasis maintenance.