SETDB1 is a histone-lysine N-methyltransferase critical for germline development. However, its function in early meiotic prophase I remains unknown. Here, we report that Setdb1 null spermatocytes display aberrant centromere clustering during leptotene, bouquet formation during zygotene, and subsequent failure in pairing and synapsis of homologous chromosomes, as well as compromised meiotic silencing of unsynapsed chromatin, which leads to meiotic arrest before pachytene and apoptosis of spermatocytes. H3K9me3 is enriched in centromeric or pericentromeric regions and is present in many sites throughout the genome, with a subset changed in the Setdb1 mutant. These observations indicate that SETDB1-mediated H3K9me3 is essential for the bivalent formation in early meiosis. Transcriptome analysis reveals the function of SETDB1 in repressing transposons and transposon-proximal genes and in regulating meiotic and somatic lineage genes. These findings highlight a mechanism in which SETDB1-mediated H3K9me3 during early meiosis ensures the formation of homologous bivalents and survival of spermatocytes.