Ikaros plays a key role in lymphocyte development and homeostasis by both potentiating and repressing gene expression. Here we show that Ikaros interacts with components of the SUMO pathway and is SUMOylated in vivo. Two SUMOylation sites are identified on Ikaros whose simultaneous modification results in a loss of Ikaros' repression function. Ikaros SUMOylation disrupts its participation in both histone deacetylase (HDAC)-dependent and HDAC-independent repression but does not influence its nuclear localization into pericentromeric heterochromatin. These studies reveal a new dynamic way by which Ikaros-mediated gene repression is controlled by SUMOylation.