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Stephen Sprouse, fashion designer, artist and photographer who brought a counterculture style to a wider American audience, died Thursday at St. Luke’s-Roosevelt Hospital Center in New York of heart failure. He was 50.

Mr. Sprouse had been diagnosed with lung cancer a year ago, said his mother, Joanne.

He was a critical darling when he burst onto the scene with his spare, colorful designs in the early 1980s. But his business acumen never matched his creativity.

Although his first two collections, launched in 1983 and 1984, were huge hits, he was out of business in 1985-87. In 1987, he opened shops in New York and Los Angeles, but he lacked financial backing and closed down again in 1988-92.

Mr. Sprouse, an Ohio native, designed a line for Bergdorf Goodman in 1992, and Barneys New York handled the production of an exclusive clothing line three years later.

Despite such commercial ups and downs, Mr. Sprouse’s talent was so admired that his designs continued to fetch high prices in vintage stores long after he stopped producing clothes.

When the SoHo and East Village neighborhoods were uncharted territory to the fashion establishment, Mr. Sprouse unleashed an underground clothing sensibility that married punk, rock ‘n’ roll and Pop Art.

“His look was Mod all the way,” said Patricia Field, costume designer for HBO’s “Sex and the City,” and whose Greenwich Village shop was a center for the fashion alternatives that flourished in the 1980s.

“It was very pop, very TV, very flash in your face. His styles were classic–miniskirts and suits–but they were way twisted. He’d do a man’s suit, but it would be hot pink. All of New York City was walking around in his clothes because they were fun and lighthearted. He was a cross between optimistic and punk rock. There was a cartoon quality to his work,” Field said.

“If you make a couple of hot things and you milk them, that’s how you make money in this world,” she added. “I don’t think Stephen was really focused on being huge and making a lot of money. He was an idealist making an ideal collection. He never sold out.”

In 2002, Mr. Sprouse created a collection of graffiti-spattered tank tops, skateboards and swimsuits for the Target store chain.

“If Warhol were alive today, he’d totally be doing stuff for Target,” Mr. Sprouse said. “So much of what Andy did has been assimilated into the culture.”