We report the covalent functionalization of graphene by photochemical chlorination. The gas-phase photochlorination of graphene, followed by the structural transformation of the C-C bonds from sp(2) to sp(3) configuration, could remove the conducting π-bands and open up a band gap in graphene. X-ray photoelectron spectroscopy revealed that chlorine is grafted to the basal plane of graphene, with about 8 atom % chlorine coverage. Raman spectroscopy, atomic force microscopy, and transmission electron microscopy all indicated that the photochlorinated graphene is homogeneous and nondestructive. The resistance increases over 4 orders of magnitude and a band gap appears upon photochlorination, confirmed by electrical measurements. Moreover, localized photochlorination of graphene can facilitate chemical patterning, which may offer a feasible approach to the realization of all-graphene circuits.