Ure2 is the protein determinant of the [URE3] prion phenotype in Saccharomyces cerevisiae and consists of a flexible N-terminal prion-determining domain and a globular C-terminal glutathione transferase-like domain. Overexpression of the type I Hsp40 member Ydj1 in yeast cells has been found to result in the loss of [URE3]. However, the mechanism of prion curing by Ydj1 remains unclear. Here we tested the effect of overexpression of Hsp40 members Ydj1, Sis1, and Apj1 and also Hsp70 co-chaperones Cpr7, Cns1, Sti1, and Fes1 in vivo and found that only Ydj1 showed a strong curing effect on [URE3]. We also investigated the interaction of Ydj1 with Ure2 in vitro. We found that Ydj1 was able to suppress formation of amyloid-like fibrils of Ure2 by delaying the process of fibril formation, as monitored by thioflavin T binding and atomic force microscopy imaging. Controls using bovine serum albumin, Sis1, or the human Hsp40 homologues Hdj1 or Hdj2 showed no significant inhibitory effect. Ydj1 was only effective when added during the lag phase of fibril formation, suggesting that it interacts with Ure2 at an early stage in fibril formation and delays the nucleation process. Using surface plasmon resonance and size exclusion chromatography, we demonstrated a direct interaction between Ydj1 and both wild type and N-terminally truncated Ure2. In contrast, Hdj2, which did not suppress fibril formation, did not show this interaction. The results suggest that Ydj1 inhibits Ure2 fibril formation by binding to the native state of Ure2, thus delaying the onset of oligomerization.