Initiation of an inflammatory cascade following traumatic spinal cord injury (SCI) is thought to cause secondary injury and to adversely impact functional recovery, although the mechanisms involved are not well defined. We report on the dynamics of complement activation and deposition in the mouse spinal cord following traumatic injury, the role of complement in the development of SCI, and the characterization of a novel targeted complement inhibitor. Following traumatic injury, mice deficient in C3 had a significantly improved locomotor score when compared with wild-type controls, and analysis of their spinal cords revealed significantly more tissue sparing, with significantly less necrosis, demyelination, and neutrophil infiltration. Wild-type mice were also treated with CR2-Crry, a novel inhibitor of complement activation that targets to sites of C3 deposition. A single intravenous injection of CR2-Crry 1 hour after traumatic injury improved functional outcome and pathology to an extent similar to that seen in C3-deficient animals. CR2-Crry specifically targeted to the injured spinal cord in a distribution pattern corresponding to that seen for deposited C3. As immunosuppression is undesirable in patients following SCI, targeted CR2-Crry may provide appropriate bioavailability to treat SCI at a dose that does not significantly affect systemic levels of serum complement activity.