The adenovirus E1B 55-kDa protein binds to cellular tumor suppressor p53 and inactivates its transcriptional transactivation function. p53 transactivation activity is dependent upon its ability to bind to specific DNA sequences near the promoters of its target genes. It was shown recently that p53 is acetylated by transcriptional coactivators p300, CREB bidning protein (CBP), and PCAF and that acetylation of p53 by these proteins enhances p53 sequence-specific DNA binding. Here we show that the E1B 55-kDa protein specifically inhibits p53 acetylation by PCAF in vivo and in vitro, while acetylation of histones and PCAF autoacetylation is not affected. Furthermore, the DNA-binding activity of p53 is diminished in cells expressing the E1B 55-kDa protein. PCAF binds to the E1B 55-kDa protein and to a region near the C terminus of p53 encompassing Lys-320, the specific PCAF acetylation site. We further show that the E1B 55-kDa protein interferes with the physical interaction between PCAF and p53, suggesting that the E1B 55-kDa protein inhibits PCAF acetylase function on p53 by preventing enzyme-substrate interaction. These results underscore the importance of p53 acetylation for its function and suggest that inhibition of p53 acetylation by viral oncoproteins prevent its activation, thereby contributing to viral transformation.