TAF15 (formerly TAF(II)68) is a nuclear RNA-binding protein that is associated with a distinct population of TFIID and RNA polymerase II complexes. TAF15 harbours an N-terminal activation domain, an RNA recognition motif (RRM) and many Arg-Gly-Gly (RGG) repeats at its C-terminal end. The N-terminus of TAF15 serves as an essential transforming domain in the fusion oncoprotein created by chromosomal translocation in certain human chondrosarcomas. Post-transcriptional modifications (PTMs) of proteins are known to regulate their activity, however, nothing is known on how PTMs affect TAF15 function. Here we demonstrate that endogenous human TAF15 is methylated in vivo at its numerous RGG repeats. Furthermore, we identify protein arginine N-methyltransferase 1 (PRMT1) as a TAF15 interactor and the major PRMT responsible for its methylation. In addition, the RGG repeat-containing C-terminus of TAF15 is responsible for the shuttling between the nucleus and the cytoplasm and the methylation of RGG repeats affects the subcellular localization of TAF15. The methylation of TAF15 by PRMT1 is required for the ability of TAF15 to positively regulate the expression of the studied endogenous TAF15-target genes. Our findings demonstrate that arginine methylation of TAF15 by PRMT1 is a crucial event determining its proper localization and gene regulatory function.