Nef is the viral gene product employed by the majority of primate lentiviruses to overcome restriction by tetherin (BST-2 or CD317), an interferon-inducible transmembrane protein that inhibits the detachment of enveloped viruses from infected cells. Although the mechanisms of tetherin antagonism by HIV-1 Vpu and HIV-2 Env have been investigated in detail, comparatively little is known about tetherin antagonism by SIV Nef. Here we demonstrate a direct physical interaction between SIV Nef and rhesus macaque tetherin, define the residues in Nef required for tetherin antagonism, and show that the anti-tetherin activity of Nef is dependent on clathrin-mediated endocytosis. SIV Nef co-immunoprecipitated with rhesus macaque tetherin and the Nef core domain bound directly to a peptide corresponding to the cytoplasmic domain of rhesus tetherin by surface plasmon resonance. An analysis of alanine-scanning substitutions identified residues throughout the N-terminal, globular core and flexible loop regions of Nef that were required for tetherin antagonism. Although there was significant overlap with sequences required for CD4 downregulation, tetherin antagonism was genetically separable from this activity, as well as from other Nef functions, including MHC class I-downregulation and infectivity enhancement. Consistent with a role for clathrin and dynamin 2 in the endocytosis of tetherin, dominant-negative mutants of AP180 and dynamin 2 impaired the ability of Nef to downmodulate tetherin and to counteract restriction. Taken together, these results reveal that the mechanism of tetherin antagonism by Nef depends on a physical interaction between Nef and tetherin, requires sequences throughout Nef, but is genetically separable from other Nef functions, and leads to the removal of tetherin from sites of virus release at the plasma membrane by clathrin-mediated endocytosis.