Mutations in RECQL4 helicase are associated with Rothmund-Thomson syndrome (RTS). A subset of RTS patients is predisposed to cancer and is sensitive to DNA damaging agents. The enhanced sensitivity of cells from RTS patients correlates with the accumulation of transcriptionally active nuclear p53. We found that in untreated normal human cells these two nuclear proteins, p53 and RECQL4, instead colocalize in the mitochondrial nucleoids. RECQL4 accumulates in mitochondria in all phases of the cell cycle except S phase and physically interacts with p53 only in the absence of DNA damage. p53-RECQL4 binding leads to the masking of the nuclear localization signal of p53. The N-terminal 84 amino acids of RECQL4 contain a mitochondrial localization signal, which causes the localization of RECQL4-p53 complex to the mitochondria. RECQL4-p53 interaction is disrupted after stress, allowing p53 translocation to the nucleus. In untreated normal cells RECQL4 optimizes de novo replication of mtDNA, which is consequently decreased in fibroblasts from RTS patients. Wild-type RECQL4-complemented RTS cells show relocalization of both RECQL4 and p53 to the mitochondria, loss of p53 activation, restoration of de novo mtDNA replication and resistance to different types of DNA damage. In cells expressing Δ84 RECQL4, which cannot translocate to mitochondria, all the above functions are compromised. The recruitment of p53 to the sites of de novo mtDNA replication is also regulated by RECQL4. Thus these findings elucidate the mechanism by which p53 is regulated by RECQL4 in unstressed normal cells and also delineates the mitochondrial functions of the helicase.