DNA repair in chromatin is subject to topological constraints, suggesting a requirement for chromatin modification and remodeling activities. Thymine DNA glycosylase (TDG) initiates repair of G/T and G/U mismatches, commonly associated with CpG islands, by removing thymine and uracil moieties. We report that TDG associates with transcriptional coactivators CBP and p300 and that the resulting complexes are competent for both the excision step of repair and histone acetylation. Furthermore, TDG stimulates CBP transcriptional activity in transfected cells and reciprocally serves as a substrate for CBP/p300 acetylation. Remarkably, this acetylation triggers release of CBP from DNA ternary complexes and also regulates recruitment of repair endonuclease APE. These observations reveal a potential regulatory role for protein acetylation in base mismatch repair and a role for CBP/p300 in maintaining genomic stability.