Ubiquitin-like with PHD and RING finger domain-containing protein 1 (UHRF1)-dependent DNA methylation is essential for maintaining cell fate during cell proliferation. Developmental pluripotency-associated 3 (DPPA3) is an intrinsically disordered protein that specifically interacts with UHRF1 and promotes passive DNA demethylation by inhibiting UHRF1 chromatin localization. However, the molecular basis of how DPPA3 interacts with and inhibits UHRF1 remains unclear. We aimed to determine the structure of the mouse UHRF1 plant homeodomain (PHD) complexed with DPPA3 using nuclear magnetic resonance. Induced α-helices in DPPA3 upon binding of UHRF1 PHD contribute to stable complex formation with multifaceted interactions, unlike canonical ligand proteins of the PHD domain. Mutations in the binding interface and unfolding of the DPPA3 helical structure inhibited binding to UHRF1 and its chromatin localization. Our results provide structural insights into the mechanism and specificity underlying the inhibition of UHRF1 by DPPA3.