Biosynthesis of sulfated saccharides that are linked to asparagine residues in the cell surface glycoprotein of Halobacterium halobium via a glucose residue involves sulfated dolichyl-monophosphoryl oligosaccharide intermediates (Lechner, J., Wieland, F., and Sumper, M. (1985) J. Biol. Chem. 260, 860-866). During isolation and characterization of these lipid oligosaccharides we detected a group of related compounds containing additional unidentified sugar residues. Here we report that: 1) the unknown sugar residues were 3-O-methylglucose, linked peripherally to the lipid-saccharide intermediates; 2) the 3-O-methylglucose residues in the oligosaccharides occur only at the lipid-linked level but are absent at the protein-linked level; 3) cell surface glycoprotein biosynthesis in Halobacteria in vivo is drastically depressed when S-adenosylmethionine-dependent methylation is inhibited, indicating that methylation is an obligatory step during glycoprotein synthesis. We propose a mechanism for the transport of lipid oligosaccharides through the cell membrane, involving an intermediate stage in which the saccharide moieties are transiently modified with 3-O-methylglucose.