The Mi-2 complex has been implicated in chromatin remodeling and transcriptional repression associated with histone deacetylation. Here, we use a purified Mi-2 complex containing six components, Mi-2, Mta 1-like, p66, RbAp48, RPD3, and MBD3, to investigate the capacity of this complex to destabilize histone-DNA interactions and deacetylate core histones. The Mi-2 complex has ATPase activity that is stimulated by nucleosomes but not by free histones or DNA. This nucleosomal ATPase is relatively inefficient, yet is essential to facilitate both translational movement of histone octamers relative to DNA and the efficient deacetylation of the core histones within a mononucleosome. Surprisingly, ATPase activity had no effect on deacetylation of nucleosomal arrays.