Development of the nephron tubules, the functional units of the kidney, requires the differentiation of a renal progenitor population of mesenchymal cells to epithelial cells. This process requires an intricate balance between self-renewal and differentiation of the renal progenitor pool. Sall1 is a transcription factor necessary for renal development which is expressed in renal progenitor cells (cap mesenchyme). Sall1 recruits the Nucleosome Remodeling and Deacetylase (NuRD) chromatin remodeling complex to regulate gene transcription. We deleted Mi2β, a component of the NuRD complex, in cap mesenchyme (CM) to examine its role in progenitor cells during kidney development. These mutants displayed significant renal hypoplasia with a marked reduction in nephrons. Markers of renal progenitor cells, Six2 and Cited1 were significantly depleted and progenitor cell proliferation was reduced. We also demonstrated that Sall1 and Mi2β exhibited a strong in vivo genetic interaction in the developing kidney. Together these findings indicate that Sall1 and NuRD act cooperatively to maintain CM progenitor cells.