Human transcriptional coactivator PC4 is a highly abundant multifunctional protein which plays diverse important roles in cellular processes, including transcription, replication, and repair. It is also a unique activator of p53 function. Here we report that PC4 is a bona fide component of chromatin with distinct chromatin organization ability. PC4 is predominantly associated with the chromatin throughout the stages of cell cycle and is broadly distributed on the mitotic chromosome arms in a punctate manner except for the centromere. It selectively interacts with core histones H3 and H2B; this interaction is essential for PC4-mediated chromatin condensation, as demonstrated by micrococcal nuclease (MNase) accessibility assays, circular dichroism spectroscopy, and atomic force microscopy (AFM). The AFM images show that PC4 compacts the 100-kb reconstituted chromatin distinctly compared to the results seen with the linker histone H1. Silencing of PC4 expression in HeLa cells results in chromatin decompaction, as evidenced by the increase in MNase accessibility. Knocking down of PC4 up-regulates several genes, leading to the G2/M checkpoint arrest of cell cycle, which suggests its physiological role as a chromatin-compacting protein. These results establish PC4 as a new member of chromatin-associated protein family, which plays an important role in chromatin organization.