Posttranslational proteolytic processing of chemokines is a natural mechanism to regulate inflammation. In this study, we describe modification of the CXC chemokine stromal cell-derived factor 1α/CXCL12 by peptidylarginine deiminase (PAD) that converts arginine residues into citrulline (Cit), thereby reducing the number of positive charges. The three NH2-terminal arginines of CXCL12, Arg8, Arg12, and Arg20, were citrullinated upon incubation with PAD. The physiologic relevance of citrullination was demonstrated by showing coexpression of CXCL12 and PAD in Crohn’s disease. Three CXCL12 isoforms were synthesized for biologic characterization: CXCL12-1Cit, CXCL12-3Cit, and CXCL12-5Cit, in which Arg8, Arg8/Arg12/Arg20, or all five arginines were citrullinated, respectively. Replacement of only Arg8 caused already impaired (30-fold reduction) CXCR4 binding and signaling (calcium mobilization, phosphorylation of ERK and protein kinase B) properties. Interaction with CXCR4 was completely abolished for CXCL12-3Cit and CXCL12-5Cit. However, the CXCR7-binding capacities of CXCL12-1Cit and CXCL12-3Cit were, respectively, intact and reduced, whereas CXCL12-5Cit failed to bind CXCR7. In chemotaxis assays with lymphocytes and monocytes, CXCL12-3Cit and CXCL12-5Cit were completely devoid of activity, whereas CXCL12-1Cit, albeit at higher concentrations than CXCL12, induced migration. The antiviral potency of CXCL12-1Cit was reduced compared with CXCL12 and CXCL12-3Cit and CXCL12-5Cit (maximal dose 200 nM) could not inhibit infection of lymphocytic MT-4 cells with the HIV-1 strains NL4.3 and HE. In conclusion, modification of CXCL12 by one Cit severely impaired the CXCR4-mediated biologic effects of this chemokine and maximally citrullinated CXCL12 was inactive. Therefore, PAD is a potent physiologic down-regulator of CXCL12 function.