Metastasis tumor antigen 1 (MTA1), a component of the Mi-2·nucleosome remodeling and deacetylase complex, plays a crucial role in gene transcription, but the mechanism involved remains largely unknown. Here, we report that MTA1 is a substrate for small ubiquitin-related modifier 2/3 (SUMO2/3) in vivo. Protein inhibitor of activated STAT (PIAS) proteins enhance SUMOylation of MTA1 and may participate in paralog-selective SUMOylation, whereas sentrin/SUMO-specific protease 1 (SENP1) and 2 may act as deSUMOylation enzymes for MTA1. Moreover, MTA1 contains a functional SUMO-interacting motif (SIM) at its C terminus, and SIM is required for the efficient SUMOylation of MTA1. SUMO conjugation on Lys-509, which is located within the SUMO consensus site, together with SIM synergistically regulates the co-repressor activity of MTA1 on PS2 transcription, probably by recruiting HDAC2 onto the PS2 promoter. Interestingly, MTA1 may up-regulate the expression of SUMO2 via interaction with RNA polymerase II and SP1 at the SUMO2 promoter. These findings not only provide novel mechanistic insights into the regulation of the transcriptional repressor function of MTA1 by SUMOylation and SIM but also uncover a potential function of MTA1 in modulating the SUMOylation pathway.