ABSTRACT Rho family GTPases are critical for normal B cell development and function and their activity is regulated by a large and complex network of guanine nucleotide exchange factors (GEFs) and GTPase activating proteins (GAPs). However, the role of GAPs in B cell development is poorly understood. Here we show that the novel Rac-GAP ARHGAP25 is important for B cell development in mice in a CXCR4-dependent manner. We show that Arhgap25 deficiency leads to a significant decrease in peripheral blood B cell numbers, as well as defects in mature B cell differentiation. Arhgap25 -/- B cells respond to antigen stimulation in vitro and in vivo but have impaired germinal center formation and decreased IgG1 class switching. Additionally, Arhgap25 -/- B cells exhibit increased chemotaxis to CXCL12. Taken together, these studies demonstrate an important role for Arhgap 25 in peripheral B cell development and antigen response.