The tumor suppressor p53 is at the hub of cellular signaling networks that are activated by stress signals including DNA damage. In the present study, we showed that programmed cell death 5 (PDCD5) bound to p53 by glutathione S-transferase (GST)-pulldown, co-immunoprecipitation and co-localization assays. PDCD5 enhanced the stability of p53 by antagonizing Mdm2-induced p53 ubiquitination, nuclear export and proteasomal degradation. We also found that PDCD5 could dissociate the interaction between p53 and Mdm2 and interact with Mdm2 directly to promote its degradation. In cells with or without induction of DNA damage, knockdown of PDCD5 by RNA interference decreased the p53 phosphorylation at Ser9, 20 and 392 residues, as well as the expression of p21 protein. Additionally, chromatin immunoprecipitation assays showed an up-regulated association of PDCD5 at the p53BS2 site of the p21 promoter during DNA damage. Cell cycle analysis also indicated that PDCD5 was required in G1 phase cell arrest during DNA damage. In summary, PDCD5 may contribute to maintain a basal pool of p53 proteins in unstressed conditions, but upon DNA damage it functions as a co-activator of p53 to regulate transcription and cell cycle arrest.