We study the roles of graphene acting as a buffer layer for growth of an AlN film on a sapphire substrate. Graphene can reduce the density of AlN nuclei but increase the growth rate for an individual nucleus at the initial growth stage. This can lead to the reduction of threading dislocations evolved at the coalescence boundaries. The graphene interlayer also weakens the interaction between AlN and sapphire and accommodates their large mismatch in the lattice and thermal expansion coefficients; thus, the compressive strain in AlN and the tensile strain in sapphire are largely relaxed. The effective relaxation of strain further leads to a low density of defects in the AlN films. These findings reveal the roles of graphene in III-nitride growth and offer valuable insights into the efficient applications of graphene in the light-emitting diode industry.