Phage ΦC31 integrase has potential as a means of inserting therapeutic genes into specific sites in the human genome. However, the possible interactions between ΦC31 integrase and cellular proteins have never been investigated. Using pLexA-ΦC31 integrase as bait, we screened a pB42AD-human fetal brain cDNA library for potential interacting cellular proteins. Among 61 positives isolated from 10 6 independent clones, 51 contained DAXX C-terminal fragments. The strong interaction between DAXX and ΦC31 was further confirmed by co-immunoprecipitation. Deletion analysis revealed that the fas-binding domain of DAXX is also the region for ΦC31 binding. Hybridization between a ΦC31 integrase peptide array and an HEK293 cell extract revealed that a tetramer, 451RFGK454, in the C-terminus of ΦC31 is responsible for the interaction with DAXX. This tetramer is also necessary for ΦC31 integrase activity as removal of this tetramer resulted in a complete loss of integrase activity. Co-expression of DAXX with ΦC31 integrase in a HEK293-derived ΦC31 integrase activity reporter cell line significantly reduced the ΦC31-mediated recombination rate. Knocking down DAXX with a DAXX-specific duplex RNA resulted in increased recombination efficiency. Therefore, endogenous DAXX may interact with ΦC31 causing a mild inhibition in the integration efficiency. This is the first time that ΦC31 was shown to interact with an important cellular protein and the potential effect of this interaction should be further studied. © 2006 Oxford University Press.