ATP-dependent chromatin remodellers are mutated in more than 20% of human cancers. The consequences of these mutations on enzyme function are poorly understood. Here, we characterise the effects of CHD4 mutations identified in endometrial carcinoma on the remodelling properties of dMi-2, the highly conserved Drosophila homologue of CHD4. Mutations from different patients have surprisingly diverse defects on nucleosome binding, ATPase activity and nucleosome remodelling. Unexpectedly, we identify both mutations that decrease and increase the enzyme activity. Our results define the chromodomains and a novel regulatory region as essential for nucleosome remodelling. Genetic experiments in Drosophila demonstrate that expression of cancer-derived dMi-2 mutants misregulates differentiation of epithelial wing structures and produces phenotypes that correlate with their nucleosome remodelling properties. Our results help to define the defects of CHD4 in cancer at the mechanistic level and provide the basis for the development of molecular approaches aimed at restoring their activity.