Histone deacetylases (HDACs) play a key role in regulating eukaryotic gene expression. The HDAC domain, homologous to the yeast repressors RPD3 and HDA1, is considered necessary and sufficient for enzymatic activity. Here, we show that the catalytic domain of HDAC4 interacts with HDAC3 via the transcriptional corepressor N-CoR/SMRT. All experimental conditions leading to the suppression of HDAC4 binding to SMRT/N-CoR and to HDAC3 result in the loss of enzymatic activity associated with HDAC4. In vitro reconstitution experiments indicate that HDAC4 and other class II HDACs are inactive in the context of the SMRT/N-CoR-HDAC3 complex and do not contribute to its enzymatic activity. These observations indicate that class II HDACs regulate transcription by bridging the enzymatically active SMRT/N-CoR-HDAC3 complex and select transcription factors independently of any intrinsic HDAC activity.