Interferon-γ inducible factor 16 (IFI16) is a multifunctional nuclear protein involved in transcriptional regulation, induction of interferon-β (IFN-β), and activation of the inflammasome response. It interacts with the sugar-phosphate backbone of dsDNA and modulates viral and cellular transcription through largely undetermined mechanisms. IFI16 is a restriction factor for human cytomegalovirus (HCMV) and herpes simplex virus (HSV-1), though the mechanisms of HSV-1 restriction are not yet understood. Here, we show that IFI16 has a profound effect on HSV-1 replication in human foreskin fibroblasts, osteosarcoma cells, and breast epithelial cancer cells. IFI16 knockdown increased HSV-1 yield 6-fold and IFI16 overexpression reduced viral yield by over 5-fold. Importantly, HSV-1 gene expression, including the immediate early proteins, ICP0 and ICP4, the early proteins, ICP8 and TK, and the late proteins gB and Us11, was reduced in the presence of IFI16. Depletion of the inflammasome adaptor protein, ASC, or the IFN-inducing transcription factor, IRF-3, did not affect viral yield. ChIP studies demonstrated the presence of IFI16 bound to HSV-1 promoters in osteosarcoma (U2OS) cells and fibroblasts. Using CRISPR gene editing technology, we generated U2OS cells with permanent deletion of IFI16 protein expression. ChIP analysis of these cells and wild-type (wt) U2OS demonstrated increased association of RNA polymerase II, TATA binding protein (TBP) and Oct1 transcription factors with viral promoters in the absence of IFI16 at different times post infection. Although IFI16 did not alter the total histone occupancy at viral or cellular promoters, its absence promoted markers of active chromatin and decreased those of repressive chromatin with viral and cellular gene promoters. Collectively, these studies for the first time demonstrate that IFI16 prevents association of important transcriptional activators with wt HSV-1 promoters and suggest potential mechanisms of IFI16 restriction of wt HSV-1 replication and a direct or indirect role for IFI16 in histone modification.