Arabidopsis HY5 is a bZIP transcription factor that promotes photomorphogenesis. Previous studies suggested that COP1, a negative regulator of photomorphogenesis, directly interacts with nuclear HY5 and targets it for proteasome-mediated degradation. Light negatively regulates the nuclear level of COP1 and thus permits HY5 accumulation. Here we report that HY5 abundance peaks in early seedling development, consistent with its role in promoting photomorphogenesis. HY5 acts exclusively within a complex and exists in two isoforms, resulting from phosphorylation within its COP1 binding domain by a light- regulated kinase activity. Unphosphorylated HY5 shows stronger interaction with COP1, is the preferred substrate for degradation, has higher affinity to target promoters and is physiologically more active than the phosphorylated version. Therefore, HY5 phosphorylation provides an added level of light-mediated regulation of HY5 stability and activity besides nuclear COP1 levels. Regulated HY5 phosphorylation not only provides abundant and physiologically more active unphosphorylated HY5 in the light, but also helps to maintain a small pool of less active phosphorylated HY5 in the dark, which could be essential for a rapid initial response during dark-to-light transition.