The class II histone deacetylases HDAC4 and HDAC5 interact specifically with the myogenic MEF2 transcription factor and repress its activity. Here we show that HDAC4 is cytoplasmic during myoblast differentiation, but relocates to the nucleus once fusion has occurred. Inappropriate nuclear entry of HDAC4 following overexpression suppresses the myogenic programme as well as MEF2-dependent transcription. Activation of the Ca(2+)/calmodulin signalling pathway via constitutively active CaMKIV prevents nuclear entry of HDAC4 and HDAC4-mediated inhibition of differentiation. Consistent with a role of phosphorylation in HDAC4 cytoplasmic localisation, HDAC4 binds to 14-3-3 proteins in a phosphorylation-dependent manner. Together these data establish a role for HDAC4 in muscle differentiation. Recently, HDAC5 has also been implicated in muscle differentiation. However, despite the functional similarities of HDAC4 and HDAC5, their intracellular localisations are opposed, suggesting a distinct role for these enzymes during muscle differentiation.