7-Methylguanine (7-MG), a natural compound that inhibits DNA repair enzyme poly(ADP-ribose) polymerase 1 (PARP-1), can be considered as a potential anticancer drug candidate. Here we describe a study of 7-MG inhibition mechanism using molecular dynamics, fluorescence anisotropy and single-particle Förster resonance energy transfer (spFRET) microscopy approaches to elucidate intermolecular interactions between 7-MG, PARP-1 and nucleosomal DNA. It is shown that 7-MG competes with substrate NAD+ and its binding in the PARP-1 active site is mediated by hydrogen bonds and nonpolar interactions with the Gly863, Ala898, Ser904, and Tyr907 residues. 7-MG promotes formation of the PARP-1–nucleosome complexes and suppresses DNA-dependent PARP-1 automodification. This results in nonproductive trapping of PARP-1 on nucleosomes and likely prevents the removal of genotoxic DNA lesions.