Chromobox protein homologue 7 (CBX7) is a chromobox family protein encoding a novel polycomb protein, the expression of which shows a progressive reduction, well related with the malignant grade of the thyroid neoplasias. Indeed, CBX7 protein levels decreased in an increasing percentage of cases going from benign adenomas to papillary, follicular, and anaplastic thyroid carcinomas. To elucidate the function of CBX7 in carcinogenesis, we searched for CBX7 interacting proteins by a proteomic analysis. By this approach, we identified several proteins. Among these proteins, we selected histone deacetylase 2 (HDAC2), which is well known to play a key role in neoplastic cell transformation and down-regulation of E-cadherin expression, the loss of which is a critical event in the epithelial-to-mesenchymal transition. We confirmed by coimmunoprecipitation that CBX7 physically interacts with the HDAC2 protein and is able to inhibit its activity. Then, we showed that both these proteins bind the E-cadherin promoter and that CBX7 up-regulates E-cadherin expression. Consistent with these data, we found a positive statistical correlation between CBX7 and E-cadherin expression in human thyroid carcinomas. Finally, we showed that the expression of CBX7 increases the acetylation status of the histones H3 and H4 on the E-cadherin promoter. Therefore, the ability of CBX7 to positively regulate E-cadherin expression by interacting with HDAC2 and inhibiting its activity on the E-cadherin promoter would account for the correlation between the loss of CBX7 expression and a highly malignant phenotype.