Membrane-associated RING-CH (MARCH) 2 protein is a member of the MARCH protein family of RING-CH finger E3 ubiquitin ligases that have important functions in regulating the levels of proteins found on the cell surface. MARCH1, 2 and 8 inhibit HIV-1 infection by preventing the incorporation of the envelope glycoproteins in nascent virions. However, a better understanding on the mechanism utilized by MARCH proteins to restrict HIV-1 is needed. In this report, we identify an amino acid in human MARCH2, that is absent in mouse MARCH2, critical for its antiretroviral function. Moreover, we map the domains of human MARCH2 critical for restricting as well as binding to the HIV-1 envelope glycoproteins. Our findings reveal important new aspects of the antiviral mechanism utilized by human MARCH2 to restrict HIV-1 that have potential implications to all MARCH proteins with antiviral functions.