The contribution of CXCL12/CXCR4/CXCR7 axis to cancer progression has been increasingly recognized. However, its role in thyroid cancer development remains unclear. The present study aimed to examine the expression and function of CXCL12 and its receptors in thyroid cancer. The expression of CXCL12/CXCR4/CXCR7 in human tissue specimens of papillary, follicular, medullary, and anaplastic thyroid carcinoma, follicular adenoma, Hashimoto's thyroiditis and nodular goiter were examined by immunohistochemistry using a tissue microarray. CXCR4 and CXCR7 were over-expressed in human thyroid cancer cells K1 by transduction of recombinant lentivirus. The effect of overexpression of CXCR4 and CXCR7 on K1 cell proliferation and invasion and the molecular mechanism underlying the effect were investigated. CXCL12 was exclusively expressed in papillary thyroid carcinoma tissue but absent in other types of thyroid malignancies and benign lesions. CXCR7 was widely expressed in the endothelial cells of all types of malignancy but only occasionally detected in benign lesions. CXCR4 was expressed in 62.5% of papillary thyroid carcinoma tissue specimens and in 30-40% of other types of malignancy, and it was either absent or weakly expressed in benign lesions. CXCL12 stimulated the invasion and migration of K1 cells overexpressing CXCR4, but did not affect K1 cells overexpressing CXCR7. K1 cell proliferation was not affected by overexpression of CXCR4 or CXCR7. Overexpression of CXCR4 in K1 cells significantly increased AKT and ERK phosphorylation and markedly induced the expression and activity of matrix metalloproteinase-2 (MMP‑2). Thus, CXCL12 may be an effective diagnostic marker for papillary thyroid carcinoma, and CXCL12/CXCR4/CXCR7 axis may contribute to thyroid cancer development by regulating cancer cell migration and invasion via AKT and ERK signaling and MMP-2 activation.