Inhibition of constitutive active signaling pathways, which are a characteristic phenomenon for many tumors, can be an effective therapeutic strategy. In contrast, oncogenic transcription factors, often activated by mutational events, are in general less amenable to small-molecule inhibition despite their obvious importance as therapeutic targets. One example of this is alveolar rhabdomyosarcoma (aRMS), in which specific translocations lead to the formation of the chimeric transcription factor PAX3/FKHR. Here, we found unexpectedly that the transcriptional activity of PAX3/FKHR can be inhibited by the kinase inhibitor PKC412. This occurs via specific phosphorylation sites in the PAX3 domain, phosphorylation of which is required for efficient DNA-binding and subsequent transcriptional activity. Consequently, we show that PKC412 exerts a potent antitumorigenic potential for aRMS treatment both in vitro and in vivo. Our study suggests that posttranscriptional modifications of oncogenic transcription factors can be explored as a promising avenue for targeted cancer therapy.