The RanGTP gradient across the interphase nuclear envelope and on the condensed mitotic chromosomes is essential for many cellular processes, including nucleocytoplasmic transport and spindle assembly. Although the chromosome-associated enzyme RCC1 is responsible for RanGTP production, the mechanism of generating and maintaining the RanGTP gradient in vivo remains unknown. Here, we report that regulator of chromosome condensation (RCC1) rapidly associates and dissociates with both interphase and mitotic chromosomes in living cells, and that this mobility is regulated during the cell cycle. Our kinetic modeling suggests that RCC1 couples its catalytic activity to chromosome binding to generate a RanGTP gradient. Indeed, we have demonstrated experimentally that the interaction of RCC1 with the chromatin is coupled to the nucleotide exchange on Ran in vivo. The coupling is due to the stable binding of the binary complex of RCC1–Ran to chromatin. Successful nucleotide exchange dissociates the binary complex, permitting the release of RCC1 and RanGTP from the chromatin and the production of RanGTP on the chromatin surface.