An imbalance in the activities of the Polycomb and Trithorax complexes underlies numerous human pathologies, including cancer. The BRCA1 associated protein-1 (BAP1) deubiquitinase negatively regulates Polycomb activity and recruits the Trithorax histone H3K4 methyltransferase, mixed-lineage leukemia protein 3 (MLL3) within Complex Proteins Associated with Set1 (COMPASS), to the enhancers of tumor suppressor genes. We previously demonstrated that the BAP1-MLL3 pathway is mutated in several cancers, yet how BAP1 recruits MLL3 to its target loci remains an important unanswered question. We demonstrate that the ASXL2 subunit of the BAP1 complex mediates a direct interaction with MLL3/COMPASS. ASXL2 loss results in decreased MLL3 occupancy at enhancers and reduced BAP1-MLL3 target gene expression. Interaction between ASXL2 and MLL3 is negatively regulated by protein arginine methyltransferase 4 (PRMT4/CARM1), which methylates ASXL2 at R639/R641. ASXL2 methylation blocks binding to MLL3 and impairs the expression of MLL3/COMPASS-dependent genes. This previously unidentified transcriptional repressive function of CARM1 provides insight into the BAP1/MLL3-COMPASS axis and reveals a potential cancer therapeutic target.