Autographa californica multiple nucleopolyhedrovirus (AcMNPV) orf53 (ac53) is a highly conserved gene existing in all sequenced Lepidoptera and Hymenoptera baculoviruses, but its function remains unknown. To investigate its role in the baculovirus life cycle, an ac53 deletion virus (vAc(ac53KO-PH-GFP)) was generated through homologous recombination in Escherichia coli. Fluorescence and light microscopy and titration analysis revealed that vAc(ac53KO-PH-GFP) could not produce infectious budded virus in infected Sf9 cells. Real-time PCR demonstrated that the ac53 deletion did not affect the levels of viral DNA replication. Electron microscopy showed that many lucent tubular shells devoid of the nucleoprotein core are present in the virogenic stroma and ring zone, indicating that the ac53 knockout affected nucleocapsid assembly. With a recombinant virus expressing an Ac53-GFP fusion protein, we observed that Ac53 was distributed within the cytoplasm and nucleus at 24 h post-infection, but afterwards accumulated predominantly near the nucleus-cytoplasm boundary. These data demonstrate that ac53 is involved in nucleocapsid assembly and is an essential gene for virus production.