Core histone modifications play an important role in chromatin remodeling and transcriptional regulation. Histone acetylation is one of the best-studied gene modifications and has been shown to be involved in numerous important biological processes. Herein, we demonstrated that the depletion of histone deacetylase 3 (Hdac3) in Drosophila melanogaster resulted in a reduction in body size. Further genetic studies showed that Hdac3 counteracted the organ overgrowth induced by overexpression of insulin receptor (InR), phosphoinositide 3-kinase (PI3K) or S6 kinase (S6K), and the growth regulation by Hdac3 was mediated through the deacetylation of histone H4 at lysine 16 (H4K16). Consistently, the alterations of H4K16 acetylation (H4K16ac) induced by the overexpression or depletion of males-absent-on-the-first (MOF), a histone acetyltransferase that specifically targets H4K16, resulted in changes in body size. Furthermore, we found that H4K16ac was modulated by PI3K signaling cascades. The activation of the PI3K pathway caused a reduction in H4K16ac, whereas the inactivation of the PI3K pathway resulted in an increase in H4K16ac. The increase in H4K16ac by the depletion of Hdac3 counteracted the PI3K-induced tissue overgrowth and PI3K-mediated alterations in the transcription profile. Overall, our studies indicated that Hdac3 served as an important regulator of the PI3K pathway and revealed a novel link between histone acetylation and growth control.