The lysine acetyltransferase CREB binding protein (CBP) is required for chromatin modification and transcription at many gene promoters. In fixed cells, a large proportion of CBP colocalises to PML or nuclear bodies. Using live cell imaging, we show here that YFP-tagged CBP expressed in HEK293 cells undergoes gradual accumulation in nuclear bodies, some of which are mobile and migrate towards the nuclear envelope. Deletion of a short lysine-rich domain that contains the major SUMO acceptor sites of CBP abrogated its ability to be SUMO modified, and prevented its association with endogenous SUMO-1/PML speckles in vivo. This SUMO-defective CBP showed enhanced ability to co-activate AML1-mediated transcription. Deletion mapping revealed that the SUMO-modified region was not sufficient for targeting CBP to PML bodies, as C-terminally truncated mutants containing this domain showed a strong reduction in accumulation at PML bodies. Fluorescence recovery after photo-bleaching (FRAP) experiments revealed that YFP–CBPΔ998–1087 had a retarded recovery time in the nucleus, as compared to YFP–CBP. These results indicate that SUMOylation regulates CBP function by influencing its shuttling between nuclear bodies and chromatin microenvironments