Primordial germ cell (PGC) migration in zebrafish is directed by the chemokine SDF-1a that activates its receptor CXCR4b. Little is known about the molecular mechanisms controlling the distribution of this chemoattractant in vivo. We demonstrate that the activity of a second SDF-1/CXCL12 receptor, CXCR7, is crucial for proper migration of PGCs toward their targets. We show that CXCR7 functions primarily in the somatic environment rather than within the migrating cells. In CXCR7 knocked-down embryos, the PGCs exhibit a phenotype that signifies defects in SDF-1a gradient formation as the cells fail to polarize effectively and to migrate toward their targets. Indeed, somatic cells expressing CXCR7 show enhanced internalization of the chemokine suggesting that CXCR7 acts as a sink for SDF-1a, thus allowing the dynamic changes in the transcription of sdf-1a to be mirrored by similar dynamics at the protein level.