A key characteristic of chloroplast gene expression is the predominance of posttranscriptional control via numerous nucleus-encoded RNA binding factors. Here, we explored the essential roles of the S1-domain-containing protein photosynthetic electron transfer B (petB)/ petD Stabilizing Factor (BSF) in the stabilization and translation of chloroplast mRNAs. BSF binds to the intergenic region of petB–petD, thereby stabilizing 3′ processed petB transcripts and stimulating petD translation. BSF also binds to the 5′ untranslated region of petA and activates its translation. BSF displayed nucleic-acid-melting activity in vitro, and its absence induces structural changes to target RNAs in vivo, suggesting that BSF functions as an RNA chaperone to remodel RNA structure. BSF physically interacts with the pentatricopeptide repeat protein Chloroplast RNA Processing 1 (AtCRP1) and the ribosomal release factor-like protein Peptide chain Release Factor 3 (PrfB3), whose established RNA ligands overlap with those of BSF. In addition, PrfB3 stimulated the RNA binding ability of BSF in vitro. We propose that BSF and PrfB3 cooperatively reduce the formation of secondary RNA structures within target mRNAs and facilitate AtCRP1 binding. The translation activation function of BSF for petD is conserved in Arabidopsis (Arabidopsis thaliana) and maize (Zea mays), but that for petA operates specifically in Arabidopsis. Our study sheds light on the mechanisms by which RNA binding proteins cooperatively regulate mRNA stability and translation in chloroplasts.