Glutaredoxins (Grxs) are ubiquitous small heat-stable disulfide oxidoreductases and members of the thioredoxin (Trx) fold protein family. In bacterial, yeast, and mammalian cells, Grxs appear to be involved in maintaining cellular redox homeostasis. However, in plants, the physiological roles of Grxs have not been fully characterized. Recently, an emerging subgroup of Grxs with one cysteine residue in the putative active motif (monothiol Grxs) has been identified but not well characterized. Here we demonstrate that a plant protein, AtGRXcp, is a chloroplast-localized monothiol Grx with high similarity to yeast Grx5. In yeast expression assays, AtGRXcp localized to the mitochondria and suppressed the sensitivity of yeast grx5 cells to H2O2 and protein oxidation. AtGRXcp expression can also suppress iron accumulation and partially rescue the lysine auxotrophy of yeast grx5 cells. Analysis of the conserved monothiol motif suggests that the cysteine residue affects AtGRXcp expression and stability. In planta, AtGRXcp expression was elevated in young cotyledons, green tissues, and vascular bundles. Analysis of atgrxcp plants demonstrated defects in early seedling growth under oxidative stresses. In addition, atgrxcp lines displayed increased protein carbonylation within chloroplasts. Thus, this work describes the initial functional characterization of a plant monothiol Grx and suggests a conserved biological function in protecting cells against protein oxidative damage.