bZIP family of transcription factors are DNA-binding proteins which bind ACGT motifs in the upstream promoter region of genes. bZIP proteins play significant roles in regulation of plant growth, secondary metabolism, development, defense and response to various abiotic and biotic stresses. Up to now, there is no report on molecular and functional characterization of bZIP transcription factors in Picrorhiza kurrooa, a medicinally important endangered herb of north western Himalayan region. The species is widely used in several commercially available drug formulations like livomap, livocare and livplus for treatment of liver disorders. The medicinal properties of P. kurrooa are due to bioactive picrosides, synthesized by isoprenoid pathway. The promoters of regulatory genes viz., Pkdxs and Pkhmgr of picroside biosynthesis pathway have been reported to contain ACGT cis-acting elements (bzip motifs) at different locations. In this study, the functionality of ACGT motifs was confirmed by electrophoretic mobility shift assay (EMSA). Full length PkbZIP gene was cloned through RACE method. In silico analysis revealed PkbZIP contained a conserved signature bZIP domain (N-x7-R/K-x9-L-x6-L-x6-L). Transcriptional activation and subcellular localization assay confirmed nuclear localization of PkbZIP. EMSA with purified PkbZIP confirmed in vitro binding of PkbZIP to ACGT elements in Pkdxs and Pkhmgr promoters. The expression pattern of PkbZIP positively correlated with the picroside (active medicinal component of the plant) content in different tissues, at 15 °C and under light conditions. Transient overexpression in Nicotiana benthamiana suggested a role of PkbZIP in terpenoid biosynthesis. PkbZIP might prove as potential candidate gene to be used in genetic engineering program for enhancing the picroside content in P. kurrooa.