Phytochrome B (phyB) is a red/far-red photoreceptor and thermosensor that regulates all aspects of plant development and growth by controlling the expression of hundreds of light- and temperature-responsive genes. PhyB reprograms the nuclear genome by regulating the stability and activity of a group of basic helix-loop-helix transcription factors called PHYTOCHROME-INTERACTING FACTORs (PIFs). At the cellular level, one of the earliest light responses is the translocation of photoactivated phyB from the cytoplasm into the nucleus and the subsequent condensation of phyB into discrete subnuclear organelles named photobodies (PBs). It was proposed that PB formation is driven by the liquid-liquid phase separation (LLPS) of active phyB. Accumulating genetic and biochemical evidence suggests that PB formation correlates with phyB signaling and light responses. For example, PBs contain many phyB signaling components including PIFs, and PBs have been associated with PIF3 degradation and PIF7 sequestration. However, because phyB and other PB components are diffusible between PBs and the surrounding nucleoplasm, the main challenge of studying PB functions has been the difficulty in dissecting the function of phyB signaling between the PB and nucleoplasmic compartments. As a result, the current data still cannot unequivocally assign a function exclusively to the PB compartment. I will discuss our recent progress in defining the function of PBs in phyB signaling and the regulation of PIFs.