APOBEC3A (A3A), one of the seven-member APOBEC3 family of cytidine deaminases, lacks strong antiviral activity against lentiviruses but is a potent inhibitor of adeno-associated virus and endogenous retroelements. In this report, we characterize the biochemical properties of mammalian cell-produced and catalytically active E. coli-produced A3A. The enzyme binds to single-stranded DNA with a Kd of 150 nM and forms dimeric and monomeric fractions. A3A, unlike APOBEC3G (A3G), deaminates DNA substrates nonprocessively. Using a panel of oligonucleotides that contained all possible trinucleotide contexts, we identified the preferred target sequence as TC (A/G). Based on a three-dimensional model of A3A, we identified a putative binding groove that contains residues with the potential to bind substrate DNA and to influence target sequence specificity. Taking advantage of the sequence similarity to the catalytic domain of A3G, we generated A3A/A3G chimeric proteins and analyzed their target site preference. We identified a recognition loop that altered A3A sequence specificity, broadening its target sequence preference. Mutation of amino acids in the predicted DNA binding groove prevented substrate binding, confirming the role of this groove in substrate binding. These findings shed light on how APOBEC3 proteins bind their substrate and determine which sites to deaminate.