Regulatory mechanisms of chondrocyte differentiation in the growth plate are incompletely understood. Here, we find that histone deacetylase 4 (HDAC4) is located in the nucleus of chondrocytes in the proliferation zone and relocates to the cytoplasm of chondrocytes in the prehypertrophic zone in vivo. This suggests that the relocation of HDAC4 from the nucleus to the cytoplasm may play a role during chondrocyte differentiation. Expression of active CaMKIV in chondrocytes promotes HDAC4 relocation into cytoplasm in primary chondrocytes. Conversely, HDAC4 relocation is blocked by a Ca(2+)/calmodulin-dependent kinase IV (CaMKIV) inhibitor. This indicates that CaMKIV signaling plays an important role in regulating HDAC4 relocation. In addition, CaMKIV is required for HDAC4 phosphorylation, which is required for HDAC4 association with the cytoplasmic protein 14-3-3. Active CaMKIV also stimulates runt-related transcription factor-2 (RunX2) and type X collagen (Col X) promoter activities and overcomes repression of these promoter activities by HDAC4. Furthermore, CaMKIV increases gene expression of the chondrocyte differentiation markers Ihh and Col X. Our results demonstrate that CaMKIV induces chondrocyte differentiation through regulation of HDAC4 subcellular relocation, from the nucleus to the cytoplasm, which results in increased activity of RunX2 and transition of chondrocytes from the proliferative to the prehypertrophic stage. Thus, CaMKIV plays an important regulatory role during chondrocyte differentiation.