Dynamic alterations in chromatin configuration occur in mammalian oocytogenesis. Based on chromatin configuration patterns, fully grown oocytes are classified into two types. One is surrounded nucleolus (SN)-type and the other is nonsurrounded nucleolus (NSN)-type oocytes. Although chromatin condensation during the transition from NSN- to SN-type oocytes is a prerequisite for normal early embryonic development, the molecular mechanisms remain unclear. In this study, we analyzed the role of DPPA3 (also known as PGC7/Stella) in this transition using Dppa3-null oocytes. The NSN-to-SN transition was significantly impaired, and transcriptional repression was incomplete in the Dppa3-null oocytes. Additionally, we revealed that prior transcriptional repression was necessary for the NSN-to-SN transition. These findings demonstrate that DPPA3 is an essential factor for the production of functional oocytes through transcriptional repression and chromatin condensation.