The U.S. Department of Homeland Security has ordered civilian federal agencies to remove DeepSeek products from their information-technology systems and prohibited them from making new purchases of the Chinese AI company’s products or third-party services built on its models.
The directive, issued Monday, expands earlier restrictions on DeepSeek across parts of the U.S. government and comes amid a broader federal effort to limit potential security risks linked to Chinese technology. According to Decrypt, DHS said use of DeepSeek could lead to sensitive information being transferred to the People’s Republic of China and could generate “actionable intelligence” about U.S. individuals or government agencies.
What the directive covers
The order applies not only to DeepSeek’s own chatbot and software, but also to outside products and services developed using the company’s models. Agencies must remove those tools from their systems and are barred from purchasing them in the future.
DHS described the models as presenting “multiple threat vectors,” referring to several possible ways that their use could create security or privacy problems. The notice specifically warned that government employees or contractors using the tools may expose sensitive data and that the technology could provide information about U.S. persons or government operations.
A DHS memo released in July had already instructed agencies to monitor traffic moving to and from government websites for risks connected to DeepSeek. The latest action turns that monitoring requirement into a broader removal and procurement restriction for civilian agencies.
DeepSeek is an open-source AI model, meaning it can be downloaded, modified and operated locally or through different hosting providers. It is therefore not limited to servers controlled by its Chinese developers. Perplexity, for example, operates DeepSeek on servers in the United States. However, DeepSeek’s own online service, DeepSeek.com, is hosted on servers in China for users of that service.
A growing list of restrictions
The Commerce Department and the U.S. Navy had already prohibited DeepSeek on government devices. Several states—New York, Tennessee and Virginia—have also taken similar steps. The Chinese Embassy in Washington had not immediately commented on the federal directive.
The action also fits into a wider debate over the use of Chinese technology in the United States. The Federal Communications Commission is scheduled to vote on October 29 on whether to bar Chinese laboratories from testing electronics intended for use in the U.S.
DeepSeek became internationally prominent on January 27, 2025, when the Hangzhou-based startup released an open-source model that demonstrated capabilities comparable to leading American AI systems at a much lower stated development cost. The model was built for under $5 million, according to the source material.
The announcement triggered a major market reaction. Nvidia shares fell 16% that day, wiping about $600 billion from the chipmaker’s value, while the broader U.S. technology sector lost an estimated $1 trillion. The episode raised questions about whether advanced AI systems could be developed and operated with fewer and less expensive computing resources than many investors had expected.
DeepSeek also faced scrutiny outside the United States. Italy’s data protection authority ordered the company to block its chatbot in the country after finding its responses to privacy questions “totally insufficient.” In April 2025, a House select committee focused on the Chinese Communist Party alleged that DeepSeek secretly sent American user data to the Chinese government. The same committee said the company may have used about 60,000 Nvidia chips, including 20,000 subject to U.S. export controls.
DeepSeek continues to develop its models
Despite the restrictions and criticism, DeepSeek has continued releasing new technology. Its V4-Pro preview, released in April, was priced about 98% below OpenAI’s GPT-5.5 Pro and was available to download and modify under an MIT license. This week, the company released an updated V4.1-Flash model focused on efficiency and described as delivering significant quality gains.
The distinction between a model and the service used to access it is central to the government’s decision. An open-source model can be deployed by different companies and on servers in different countries, while a provider’s own hosted service may handle user prompts and data in a particular jurisdiction. DHS’s order covers both DeepSeek’s direct products and third-party offerings built with its technology.
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