The multizinc finger transcription factor Sall1 is a critical developmental regulator that mediates repression through the recruitment of the nucleosome remodeling and deacetylase (NuRD) complex. Although a short conserved peptide motif in Sall1 is sufficient to recruit NuRD, its ability to regulate native Sall1 target genes in vivo has not been demonstrated. In this report, we demonstrate an in vivo role for the Sall1 repression motif and describe a novel direct target gene of Sall1, Gbx2, that is directly repressed in a NuRD-dependent fashion. The ability of Sall1 to repress Gbx2 was impaired in Xenopus embryos expressing mutant forms of Sall1 that are defective for NuRD binding. Finally, we demonstrate that protein kinase C phosphorylates serine 2 of the Sall1 repression motif and reveal that a phosphomimetic mutation of serine 2 disrupts the ability of Sall1 to repress Gbx2 in cell culture and Xenopus embryos. Together, these studies establish that Sall1 recruits NuRD via the Sall1 repression motif to mediate repression of a native target gene and suggest a model in which dynamic control of gene expression by Sall1 is modulated by serine phosphorylation of the Sall1 repression motif.