Histone methylation has a key role in oestrogen receptor (ERalpha)-mediated transactivation of genes. Proline glutamic acid and leucine-rich protein 1 (PELP1) is a new proto-oncogene that functions as an ERalpha co-regulator. In this study, we identified histone lysine demethylase, KDM1, as a new PELP1-interacting protein. These proteins, PELP1 and KDM1, were both recruited to ERalpha target genes, and PELP1 depletion affected the dimethyl histone modifications at ERalpha target genes. Dimethyl-modified histones H3K4 and H3K9 are recognized by PELP1, and PELP1 alters the substrate specificity of KDM1 from H3K4 to H3K9. Effective demethylation of dimethyl H3K9 by KDM1 requires a KDM1-ERalpha-PELP1 functional complex. These results suggest that PELP1 is a reader of H3 methylation marks and has a crucial role in modulating the histone code at the ERalpha target genes.