Nuclear receptors use lysine acetyltransferases and lysine deacetylases (KDACs) in regulating transcription through histone acetylation. Lysine acetyltransferases interact with steroid receptors upon binding of an agonist and are recruited to target genes. KDACs have been shown to interact with steroid receptors upon binding to an antagonist. We have shown previously that KDAC inhibitors (KDACis) potently repress the mouse mammary tumor virus promoter through transcriptional mechanisms and impair the ability of the glucocorticoid receptor (GR) to activate it, suggesting that KDACs can play a positive role in GR transactivation. In the current study, we extended this analysis to the entire GR transcriptome and found that the KDACi valproic acid impairs the ability of agonist-bound GR to activate about 50% of its target genes. This inhibition is largely due to impaired transcription rather than defective GR processing and was also observed using a structurally distinct KDACi. Depletion of KDAC1 expression mimicked the effects of KDACi in over half of the genes found to be impaired in GR transactivation. Simultaneous depletion of KDACs 1 and 2 caused full or partial impairment of several more GR target genes. Altogether we found that Class I KDAC activity facilitates GR-mediated activation at a sizable fraction of GR-activated target genes and that KDAC1 alone or in coordination with KDAC2 is required for efficient GR transactivation at many of these target genes. Finally, our work demonstrates that KDACi exposure has a significant impact on GR signaling and thus has ramifications for the clinical use of these drugs.