Interferon restricts SARS-CoV-2 replication in cell culture, but only a handful of Interferon Stimulated Genes with antiviral activity against SARS-CoV-2 have been identified. Here, we describe a functional CRISPR/Cas9 screen aiming at identifying SARS-CoV-2 restriction factors. We identify DAXX, a scaffold protein residing in PML nuclear bodies known to limit the replication of DNA viruses and retroviruses, as a potent inhibitor of SARS-CoV-2 and SARS-CoV replication in human cells. Basal expression of DAXX is sufficient to limit the replication of SARS-CoV-2, and DAXX over-expression further restricts infection. DAXX restricts an early, post-entry step of the SARS-CoV-2 life cycle. DAXX-mediated restriction of SARS-CoV-2 is independent of the SUMOylation pathway but dependent on its D/E domain, also necessary for its protein-folding activity. SARS-CoV-2 infection triggers the re-localization of DAXX to cytoplasmic sites and promotes its degradation. Mechanistically, this process is mediated by the viral papain-like protease (PLpro) and the proteasome. Together, these results demonstrate that DAXX restricts SARS-CoV-2, which in turn has evolved a mechanism to counteract its action.