CXCR3 is a G-protein-coupled seven-transmembrane domain chemokine receptor that plays an important role in effector T-cell and NK cell trafficking. Three gamma interferon-inducible chemokines activate CXCR3: CXCL9 (Mig), CXCL10 (IP-10), and CXCL11 (I-TAC). Here, we identify extracellular domains of CXCR3 that are required for ligand binding and activation. We found that CXCR3 is sulfated on its N terminus and that sulfation is required for binding and activation by all three ligands. We also found that the proximal 16 amino acid residues of the N terminus are required for CXCL10 and CXCL11 binding and activation but not CXCL9 activation. In addition, we found that residue R216 in the second extracellular loop is required for CXCR3-mediated chemotaxis and calcium mobilization but is not required for ligand binding or ligand-induced CXCR3 internalization. Finally, charged residues in the extracellular loops contribute to the receptor-ligand interaction. These findings demonstrate that chemokine activation of CXCR3 involves both high-affinity ligand-binding interactions with negatively charged residues in the extracellular domains of CXCR3 and a lower-affinity receptor-activating interaction in the second extracellular loop. This lower-affinity interaction is necessary to induce chemotaxis but not ligand-induced CXCR3 internalization, further suggesting that different domains of CXCR3 mediate distinct functions.