Transcription factors (TFs) are key regulators of gene expression and plant development. The plant-specific PHD-HD TF family, defined by a plant homeodomain (PHD) and homeodomain (HD) architecture, is represented in Arabidopsis thaliana by only two members: HAT3.1 and PRHA. Despite their close phylogenetic relationship, these proteins diverge substantially in molecular features, subnuclear organization, and developmental roles. HAT3.1 forms distinct nuclear condensates that partially colocalize with chromocenters. TurboID-based proximity labeling identified methyl-CpG-binding domain proteins (MBD1/2/4) as top interactors of HAT3.1; these co-localize with HAT3.1 speckles, suggesting formation of functional nuclear complexes. Furthermore, a histone peptide array revealed that the PHD domain of HAT3.1 specifically recognizes H4K20me3, a histone modification with largely unexplored roles in plants. In contrast, PRHA displays diffuse nuclear localization, and its PHD domain lacks histone binding specificity. Promoter-reporter analyses demonstrate that HAT3.1 is expressed throughout the meristematic zone of the root apical meristem, while PRHA expression is confined to initials and pericycle cells. Both genes are upregulated during callus induction and shoot regeneration, indicating a role in cellular reprogramming. Notably, prha mutants exhibit accelerated callus formation and enhanced regeneration capacity, suggesting a role in repressing cell proliferation. In summary, our data revealed a pronounced functional divergence within the PHD-HD TF family and pointed to their distinct contributions to chromatin-associated regulation and developmental reprogramming in plants.