© 2015, American College of Rheumatology. Objective A C-to-T single-nucleotide polymorphism (SNP) located at position 1858 of human protein tyrosine phosphatase PTPN22 complementary DNA carries the highest risk of rheumatoid arthritis (RA) among all non-HLA genetic variants. This C1858T SNP converts an arginine (R620) to a tryptophan (W620), but it is unclear why it has such a strong impact on RA, a disease characterized by anti-citrullinated protein antibodies. The aim of this study was to test the hypothesis that PTPN22 regulates protein citrullination. Methods The level of citrullinated proteins in immune cells was quantified by Western blotting. The physical interaction between PTPN22 and peptidyl arginine deiminase type 4 (PAD-4), which is one of the enzymes that catalyzes protein citrullination, was examined by coimmunoprecipitation. Neutrophils were collected from healthy donors carrying the C1858T SNP and healthy donors not carrying this SNP. The formation of neutrophil extracellular traps (NETs) was examined by immunocytochemistry. Results PTPN22 physically interacted with PAD-4, and a deficiency in PTPN22 enhanced protein citrullination. This abnormality was reversed by exogenous wild-type PTPN22 or catalytically dead mutant PTPN22. The R-to-W conversion rendered PTPN22 unable to interact with PAD-4 and suppress citrullination. The C1858T SNP was associated with hypercitrullination in peripheral blood mononuclear cells and a heightened propensity for spontaneous formation of NETs, which is a PAD-4-dependent process. Conclusion PTPN22 is an inhibitor of PAD-4 and protein citrullination. This function of PTPN22 is independent of its phosphatase activity but requires R620. Our data not only establish a molecular link between PTPN22 and PAD-4, but also suggest that the C1858T SNP increases the risk of RA by enhancing protein citrullination and spontaneous formation of NETs.