Protein citrullination (deimination) is the post-translational modification of arginine to the non-coded amino acid citrulline and is catalyzed by the peptidyl arginine deiminase (PADI) enzyme family. The most widely expressed of the PADIs family, PADI2, regulates cellular processes that impact several diseases. How PADI2 has evolved in mammals to gain its fundamental function is not fully understood. By performing a systematic evolutionary analysis, we now identify 20 positively selected residues in PADI2, 16 of which are structurally exposed mainly on the N-terminal and middle domains of PADI2. Our integrated evolutionary and structural analyses suggest that these residues have roles in maintaining the PADI2 interactions with cognate proteins. We experimentally demonstrate that one of the loops in the middle domain participates in the interactions of PADI2 with the positive-transcription elongation factor (P-TEFb), which is essential for active transcription and cellular proliferation. This interpretation is supported by our finding that L162 within this loop evolved under positive selection. Our work demonstrates the power of combining sequence-based phylogenetic methods with structural information for investigating the selective function of the middle domain of PADI2 in modulating transcription. This in-depth knowledge could be key to understanding the role of PADI2 overexpression in disease and points to potential targetable regions of the protein.