Chemokines are a group of small, structurally related molecules that regulate the trafficking of various types of leukocytes through interactions with a subset of 7-transmembrane G-protein-coupled receptors. As key chemoattractants of inflammatory leukocytes, chemokines have been marked as potential targets for neutralization in autoimmune diseases. Cancer cells also express chemokines, where they function as survival/growth factors and/or angiogenic factors that promote tumor development and angiogenesis. Accordingly, these functions make them attractive targets for therapy of these diseases. Recently, we reported that one of these chemokines CXCL12 (SDF-1alpha) functions as an anti-inflammatory chemokine during autoimmune inflammatory responses and explored the mechanistic basis of this function. As a pleiotropic chemokine, CXCL12 participates in the regulation of tissue homeostasis, immune surveillance, autoimmunity, and cancer. This chemokine is constitutively expressed in the BM and various tissues, which enables it to regulate the trafficking and localization of immature and maturing leukocytes, including BM stem cells, neutrophils, T cells, and monocytic cells. We have shown recently that CXCL12 increases immunological tolerance in autoimmune diseases by polarizing Tregs and by doing so, restrains the progression of these diseases. This finding suggests a possible use of stabilized rCXCL12 as a potential drug for therapy of these diseases and targeted neutralization of CXCL12 for therapy of cancer diseases. The current review explores the different biological properties of CXCL12 and discusses the implications of CXCL12-based therapies for autoimmunity and cancer diseases.