Protein lysine methyltransferases (PKMTs) methylate histone and non-histone proteins to regulate biological outcomes such as development and disease including viral infection. While PKMTs have been extensively studied for modulating the antiviral responses via host gene regulation, their role in methylation of proteins encoded by viruses and its impact on host-pathogen interactions remain poorly understood. In this study, we discovered distinct nucleo-cytoplasmic form of euchromatic histone methyltransferase 1 (EHMT1N/C), a PKMT, that phase separates into viral inclusion bodies (IBs) upon cytoplasmic RNA-virus infection (Sendai Virus). EHMT1N/C interacts with cytoplasmic EHMT2 and methylates SeV-Nucleoprotein upon infection. Elevated nucleoprotein methylation during infection correlated with coalescence of small IBs into large mature platforms for efficient replication. Inhibition of EHMT activity by pharmacological inhibitors or genetic depletion of EHMT1N/C reduced the size of IBs with a concomitant reduction in replication. Additionally, we also found that EHMT1 condensation is not restricted to SeV alone but was also seen upon pathogenic RNA viral infections caused by Chandipura and Dengue virus. Collectively, our work elucidates a new mechanism by which cytoplasmic EHMT1 acts as proviral host factor to regulate host-pathogen interaction.