Mammalian spermiogenesis, a process where haploid male germ cells differentiate to become mature spermatozoa, entails dramatic morphological and biochemical changes including remodeling of the germ cell chromatin. Proteins that contain one or more plant homeodomain (PHD) fingers have been implicated in the regulation of chromatin structure and function. Pygopus 2 (Pygo2) belongs to a family of evolutionarily conserved PHD finger proteins thought to act as co-activators of Wnt signaling effector complexes composed of beta-catenin and LEF/TCF transcription factor. Here we analyze mice containing hypomorphic alleles of pygopus 2 (Pygo2 or mpygo2) and uncover a beta-catenin-independent involvement of the Pygo2 protein in spermiogenesis. Pygo2 is expressed in elongating spermatids at stages when chromatin remodeling occurs, and block of Pygo2 function leads to spermiogenesis arrest and consequent infertility. Analysis of spermiogenesis in Pygo2 mutants reveals reduced expression of select post-meiotic genes including protamines, transition protein 2, and H1fnt, all of which are required for germ cell chromatin condensation, and drastically altered pattern of histone H3 hyperacetylation. These findings suggest that Pygo2 is involved in the chromatin remodeling events that lead to nuclear compaction of male germ cells.