Kaposi’s sarcoma-associated herpesvirus (KSHV) is a double-stranded DNA gammaherpesvirus, with a poorly characterized lytic replication cycle. However, the lytic replication cycle of the alpha- and betaherpesviruses are well characterized. During lytic infection of alpha- and betaherpesviruses, the viral genome is replicated as a precursor form, which contains tandem genomes linked via terminal repeats (TRs). One genomic unit of the precursor form is packaged into a capsid and is cleaved at the TR by the terminase complex. While the alpha- and betaherpesvirus terminases are well characterized, the KSHV terminase remains poorly understood. KSHV ORF7, ORF29, and ORF67.5 are presumed to be components of the terminase complex based on their homology to other terminase proteins. We previously reported that ORF7-deficient KSHV formed numerous immature soccer ball-like capsids and failed to cleave the TRs. ORF7 interacted with ORF29 and ORF67.5, however ORF29 and ORF67.5 did not interact with each other. While these results suggested that ORF7 is important for KSHV terminase function and capsid formation, the function of ORF67.5 was completely unknown. Therefore, to analyze the function of ORF67.5, we constructed ORF67.5-deficient BAC16. ORF67.5-deficient KSHV failed to produce infectious virus, failed to cleave the TRs, and numerous soccer ball-like capsids were observed in ORF67.5-deficient KSHV-harboring cells. Furthermore, ORF67.5 promoted the interaction between ORF7 and ORF29, and ORF29 increased the interaction between ORF67.5 and ORF7. Thus, our data indicated that ORF67.5 functions as a component of the KSHV terminase complex by contributing to TR cleavage, terminase complex formation, capsid formation, and virus production.