Kruppel-like Factor 3 (KLF3/BKLF), a member of the Kruppel-like Factor (KLF) family of transcription factors, is a widely expressed transcriptional repressor with diverse biological roles. While there is considerable understanding of the molecular mechanisms that allow KLF3 to silence the activity of its target genes, less is known about the signal transduction pathways and post-translational modifications that modulate KLF3 activity in response to physiological stimuli. We observed that KLF3 is modified in a range of different tissues and found that the serine/threonine kinase Homeodomain-interacting protein kinase 2 (HIPK2) can both bind and phosphorylate KLF3. Mass spectrometry identified serine 249 as the primary phosphorylation site. Mutation of this site reduces the ability of KLF3 to bind DNA and repress transcription. Furthermore, we also determined that HIPK2 can phosphorylate the KLF3 co-repressor C-terminal binding protein 2 (CtBP2) at serine 428. Finally, we found that phosphorylation of KLF3 and CtBP2 by HIPK2 strengthens the interaction between these two factors and increases transcriptional repression by KLF3. Taken together our results indicate that HIPK2 potentiates the activity of KLF3.