Phosphoinositides are present in the plasma membrane, cytoplasm and inside the cell nucleus. Here we identify phosphatidylinositol-4,5-bisphosphate (PIP2) as a regulator of rRNA genes transcription at the epigenetic level. We show that PIP2 directly interacts with histone lysine demethylase PHF8 (PHD finger protein 8) and represses demethylation of H3K9me2 through this interaction. We identify the C-terminal K/R-rich motif as PIP2-binding site within PHF8, and address the function of this PIP2-PHF8 complex. PIP2-binding mutant of PHF8 has increased the activity of rDNA promoter (20%) and expression of pre-rRNA genes (47S-100%; 45S-66%). Furthermore, trypsin digestion reveals a potential conformational change of PHF8 upon PIP2 binding. These observations identify the function of nuclear PIP2, and suggest that PIP2 contributes to the fine-tuning of rDNA transcription.