Epigenetic and chromatin modifications play particularly important roles in embryonic and induced pluripotent stem cells (ESCs and iPSCs) allowing for the cells to both differentiate and dedifferentiate back to a pluripotent state. We analyzed how the loss of a key chromatin-modifying enzyme, histone deacetylase 1 (HDAC1), affects early and cardiovascular differentiation of both ESCs and iPSCs. We also investigated potential differences between these two cell types when differentiation is induced. Our data indicate an essential role for HDAC1 in deacetylating regulatory regions of key pluripotency-associated genes during early differentiation. Although HDAC1 functions primarily as a HDAC, its loss also affects DNA methylation in ESCs and iPSCs both during pluripotency and differentiation. We show that HDAC1 plays a crucial, nonredundant role in cardiomyocyte differentiation and maturation. Our data also elucidate important differences between ESCs and iPSCs, when levels of this enzyme are reduced, that affect their ability to differentiate into functional cardiomyocytes. As varying levels of chromatin-modifying enzymes are likely to exist in patient-derived iPSCs, understanding the molecular circuitry of these enzymes in ESCs and iPSCs is critical for their potential use in cardiovascular therapeutic applications. STEM CELLS2012;30:2412-2422.