Chromatin in embryonic stem cells (ESCs) differs markedly from that in somatic cells, with ESCs exhibiting a more open chromatin configuration. Accordingly, ATP-dependent chromatin remodeling complexes are important regulators of ESC homeostasis. Depletion of the remodeler SMARCAD1, an ATPase of the SNF2 family, has been shown to affect stem cell state, but the mechanistic explanation for this effect is unknown. Here, we set out to gain further insights into the function of SMARCAD1 in mouse ESCs. We identified KRAB-associated protein 1 (KAP1) as the stoichiometric binding partner of SMARCAD1 in ESCs. We found that this interaction occurs on chromatin and that SMARCAD1 binds to different classes of KAP1 target genes, including zinc finger protein (ZFP) and imprinted genes. We also found that the RING B-box coiled-coil (RBCC) domain in KAP1 and the proximal coupling of ubiquitin conjugation to ER degradation (CUE) domain in SMARCAD1 mediate their direct interaction. Of note, retention of SMARCAD1 in the nucleus depended on KAP1 in both mouse ESCs and human somatic cells. Mutations in the CUE1 domain of SMARCAD1 perturbed the binding to KAP1 in vitro and in vivo. Accordingly, an intact CUE1 domain was required for tethering this remodeler to the nucleus. Moreover, mutation of the CUE1 domain compromised SMARCAD1 binding to KAP1 target genes. Taken together, our results reveal a mechanism that localizes SMARCAD1 to genomic sites through the interaction of SMARCAD1’s CUE1 motif with KAP1.