Apolipoprotein C-II, the activator protein of lipoprotein lipase, contains 78 amino acids with a single residue of arginine at position 49. Chemical modification of apolipoprotein C-II with 1,2-cyclohexanedione or 2,3-butanedione results in a loss of both the arginine residue and the ability of the protein to enhance the activity of bovine milk lipoprotein lipase toward a trioleoylglycerol substrate; removal of the modifying group restores arginine and more than 70% of the activating property of the apolipoprotein. Arginine modification of apolipoprotein C-II does not effect its lipid-binding properties as assessed by its association to sonicated vesicles of dimyristoylphosphatidylcholine. Furthermore, secondary structure associated with complex formation with dimyristoylphosphatidylcholine are nearly identical for the unmodified, 1,2-cyclohexanedione-modified or modified-reversed proteins. These results suggest that arginine-49 of apolipoprotein C-II is situated at or near an amino acid sequence domain involved in the activation of lipoprotein lipase. However, a guanidinium group is not required for lipid binding.