Neural progenitors transit through multiple competence states that restrict production of each neural cell type. In Drosophila neuroblasts, a timed genome reorganization relocates the cell fate gene, hunchback, to the nuclear periphery, terminating competence to produce early-born neurons. Distal antenna (Dan), a pipsqueak (Psq) superfamily protein, is transiently downregulated at mid-embryogenesis, which is required for this relocation. Here we find that Dan is a highly intrinsically disordered protein, and when its Psq DNA-binding domain is increasingly disrupted, Dan coalesces into steadily larger, interconnected hubs of rapid protein exchange. Consistent with these phase-separation properties, Dan has a predicted LARKS domain, a structural motif that forms reversible interactions associated with phase-separation. In the embryo, loss of either the Psq motif or the LARKS domain abrogates Dan's ability to maintain neuroblast early competence upon misexpression, suggesting that Dan requires both DNA-binding and phase-separation to regulate neuroblast competence. Finally, we found that Dan strongly interacts with proteins of the nuclear pore complex (NPC), and Elys, a core NPC scaffold protein known to regulate genome architecture, binds thehbintron and is required for competence termination. Together, the results support a model for how Dan's phase-separation properties can mediate dynamic restructuring by balancing genome-binding, self-association, and interaction among nuclear architecture regulators.