The biogenesis of exosomes, small secreted vesicles involved in signalling processes, remains incompletely understood. Here, we report evidence that the syndecan heparan sulphate proteoglycans and their cytoplasmic adaptor syntenin control the formation of exosomes. Syntenin interacts directly with ALIX through LYPX(n)L motifs, similarly to retroviral proteins, and supports the intraluminal budding of endosomal membranes. Syntenin exosomes depend on the availability of heparan sulphate, syndecans, ALIX and ESCRTs, and impact on the trafficking and confinement of FGF signals. This study identifies a key role for syndecan syntenin ALIX in membrane transport and signalling processes.