During the early phase of varicella-zoster virus (VZV) infection, Immediate Early protein 63 (IE63) is expressed rapidly and abundantly in the nucleus, while during latency, this protein is confined mostly to the cytoplasm. Because phosphorylation is known to regulate many cellular events, we investigated the importance of this modification on the cellular localization of IE63 and on its regulatory properties. We demonstrate here that cellular casein kinases I and II are implicated in the in vitro and in vivo phosphorylation of IE63. A mutational approach also indicated that phosphorylation of the protein is important for its correct cellular localization in a cell type-dependent fashion. Using an activity test, we demonstrated that IE63 was able to repress the gene expression driven by two VZV promoters and that phosphorylation of the protein was required for its full repressive properties. Finally, we showed that IE63 was capable of exerting its repressive activity in the cytoplasm, as well as in the nucleus, suggesting a regulation at the transcriptional and/or post-transcriptional level.