Fpr4 is a member of the FK506-binding protein (FKBP) family. Unlike the better studied FKBPs known as immunophilins that serve as intracellular receptors of immunosuppressants FK506 and rapamycin, Fpr4 contains an acidic domain in addition to the conserved FK506-binding domain that possesses peptidyl prolyl isomerase (PPIase) activity. Recently, it was reported that the Fpr4 is a novel histone chaperone with characteristics completely opposite to classic histone chaperones such as NAP1. Furthermore, the protein is shown to be required for gene silencing at the rDNA locus in the budding yeast Sacharomyces cerevisiae (Kuzuhara and Horikoshi, 2004, Nature Struc. & Mol. Biol.,11: 275–83). To gain insight into the function of this interesting protein, we have conducted a more detailed biochemical and genetic characterization of Fpr4. Our results show that Fpr4 facilitates nucleosome assembly in vitro in a process highly similar to that with NAP1. Furthermore, we found that the chaperone activity resides in the acidic domain and that the PPIase domain negatively regulates the chaperone activity of the protein. We have also that the PPIase domain contributes to the transcriptional repression at the rDNA locus, and is sufficient to repress transcription when tethered to the promoter of a reporter gene. Furthermore, we have demonstrated that the PPIase domain alters the topological structure of the histone H3–H4 tetramer in vitro. Taken together, our results suggest that Fpr4 is a protein that possesses a histone chaperone activity that facilitates nucleosome assembly and a peptidyl prolyl isomerase activity that may modulate the structure of the core histones. These activities, together, may impact chromatin structures and repress transcription at specific chromosome loci.