A maize histone deacetylase gene was identified as a homolog of yeast Hda1. The predicted protein corresponds to a previously purified maize deacetylase that is active as a protein monomer with a molecular weight of 48,000 and is expressed in all tissues of germinating embryos. Hda1 is synthesized as an enzymatically inactive protein with an apparent molecular weight of 84,000 that is processed to the active 48-kD form by proteolytic removal of the C-terminal part, presumably via a 65-kD intermediate. The enzymatically inactive 84-kD protein also is part of a 300-kD protein complex of unknown function. The proteolytic cleavage of ZmHda1 is regulated during maize embryo germination in vivo. Expression of the recombinant full-length protein and the 48-kD form confirmed that only the smaller enzyme form is active as a histone deacetylase. In line with this finding, we show that the 48-kD protein is able to repress transcription efficiently in a reporter gene assay, whereas the full-length protein, including the C-terminal part, lacks full repression activity. This report on the processing of Hda1-p84 to enzymatically active Hda1-p48 demonstrates that proteolytic cleavage is a mechanism to regulate the function of Rpd3/Hda1-type histone deacetylases.