Phytochrome B (phyB), the predominant red-light photoreceptor, interacts with various proteins, initiating a set of molecular events in plant cells that promote light responses. In this study, we identified AHL21, a member of the AT-hook motif nuclear-localized (AHL) family, as a phyB-interacting protein in Arabidopsis. AHL21 positively regulates photomorphogenesis by directly binding to PHYTOCHROME INTERACTING FACTOR 4 (PIF4) promoter and downregulating its expression. Moreover, AHL21 physically interacts with PIF4 and represses its transcriptional activation activity. Hence, AHL21 acts genetically upstream of PIF4. In addition, phyB directly interacts with both AHL21 and PIF4 and functions as a molecular glue that enhances the AHL21-PIF4 interaction. Collectively, AHL21 functions as a key component of the phyB-PIF4 signaling module to enable plants to adapt to fluctuating light conditions.