The nucleus is a highly organised yet dynamic environment containing distinct membrane-less nuclear bodies. However, during Kaposi’s sarcoma-associated herpesvirus (KSHV) replication, the nuclear architecture of the host cell undergoes a striking re-organization due to the formation of virus-induced replication centres. How this drastic remodelling of the nuclear architecture affects the localisation and function of nuclear bodies is yet to be fully elucidated. We demonstrate that one such nuclear body, paraspeckles, a protein-rich nuclear condensate formed around the architectural RNA NEAT1_2 are drastically affected during infection. Specifically, KSHV drives the formation of novel, non-canonical paraspeckles during lytic replication, which we now term virus-modified paraspeckles (v-mPS). Specifically, we show that v-mPS are altered in their localisation, aligning adjacent to virus replication centres, and are approximately 10 times larger than the size of standard paraspeckles. Further evidence supports that these structures are modified and distinct from canonical paraspeckles, confirmed by their altered protein composition including the association of the multifunctional KSHV-encoded ORF11 protein, which appears to be essential for v-mPS formation. Notably, we also show that disruption of v-mPS formation leads to a reduction in virus replication and infectious virion production. We further show that viral transcripts are associated with multiple paraspeckle components within v-mPS, which suggest they function as hubs for the processing of viral RNAs required for efficient KSHV lytic replication.