Although histone deacetylases (HDACs) are normally considered as co-repressors, HDAC1 has been identified as a coactivator for the glucocorticoid receptor (GR) (Qiu, Y., Zhao, Y., Becker, M., John, S., Parekh, B. S., Huang, S., Hendarwanto, A., Martinez, E. D., Chen, Y., Lu, H., Adkins, N. L., Stavreva, D. A., Wiench, M., Georgel, P. T., Schiltz, R. L., and Hager, G. L. (2006) Mol. Cell 22, 669-679). Furthermore, HDAC1 is acetylated, and its acetylation level is linked to the transcription state of a GR-induced promoter (mouse mammary tumor virus). GR is also known to interact dynamically with regulatory elements in living cells (McNally, J. G., Müller, W. G., Walker, D., Wolford, R., and Hager, G. L. (2000) Science 287, 1262-1265). However, HDAC1 dynamics have never been studied. We demonstrate here that HDAC1 also exchanges rapidly with promoter chromatin, and its exchange rate is significantly modulated during the development of promoter activity. Prior to induction, HDAC1 mobility was retarded compared with the exchange rate for GR. HDAC1 mobility then increased substantially, coordinately with the peak of promoter activity. At later time points, promoter activity was severely repressed, and HDAC1 mobility returned to the rate of exchange observed for the uninduced promoter. Thus, alterations of the exchange rates of HDAC1 at the promoter are correlated with the activity state of the promoter. These findings provide direct evidence for the functional role of highly mobile transcription factor complexes in transcription regulation.