CCCTC-binding factor (CTCF) is a ubiquitously expressed “master weaver” and plays multiple functions in the genome, including transcriptional activation/repression, chromatin insulation, imprinting, X chromosome inactivation, and high-order chromatin organization. It has been shown that CTCF facilitates the recruitment of the upstream binding factor onto ribosomal DNA (rDNA) and regulates the local epigenetic state of rDNA repeats. However, the mechanism by which CTCF modulates rRNA gene transcription has not been well understood. Here we found that wild-type CTCF augments the pre-rRNA level, cell size, and cell growth in cervical cancer cells. In contrast, RNA interference-mediated knockdown of CTCF reduced pre-rRNA transcription. CTCF positively regulates rRNA gene transcription in a RNA polymerase I-dependent manner. We identified an RRGR motif as a putative nucleolar localization sequence in the C-terminal region of CTCF that is required for activating rRNA gene transcription. Using mass spectrometry, we identified SMC2 and SMC4, two subunits of condensin complexes that interact with CTCF. Condensin negatively regulates CTCF-mediated rRNA gene transcription. Knockdown of SMC2 expression significantly facilitates the loading of CTCF and the upstream binding factor onto the rDNA locus and increases histone acetylation across the rDNA locus. Taken together, our study suggests that condensin competes with CTCF in binding to a specific rDNA locus and negatively regulates CTCF-mediated rRNA gene transcription.