Runx2/Cbfa1/Pebp2aA is a global regulator of osteogenesis and is crucial for regulating the expression of bone-specific genes. Runx2 is a major target of the bone morphogenetic protein (BMP) pathway. Genetic analysis has revealed that Runx2 is degraded through a Smurf-mediated ubiquitination pathway, and its activity is inhibited by HDAC4. Here, we demonstrate the molecular link between Smurf, HDACs and Runx2, in BMP signaling. BMP-2 signaling stimulates p300-mediated Runx2 acetylation, increasing transactivation activity and inhibiting Smurf1-mediated degradation of Runx2. HDAC4 and HDAC5 dea-cetylate Runx2, allowing the protein to undergo Smurf-mediated degradation. Inhibition of HDAC increases Runx2 acetylation, and potentiates BMP-2-stimulated osteoblast differentiation and increases bone formation. These results demonstrate that the level of Runx2 is controlled by a dynamic equilibrium of acetylation, deacetylation, and ubiquitination. These findings have important medical implications because BMPs and Runx2 are of tremendous interest with regard to the development of therapeutic agents against bone diseases.