Catalyzes the deacetylation of lysine residues on the N-terminal part of the core histones (H2A, H2B, H3 and H4) (PubMed:11571273, PubMed:28245922, PubMed:12408863). Histone deacetylation may constitute a tag for epigenetic repression and plays an important role in transcriptional regulation, cell cycle progression and developmental events (PubMed:11571273, PubMed:8955276, PubMed:15545624, PubMed:15306652). For instance, deacetylation of histone H3 may be a prerequisite for the subsequent recruitment of the histone methyltransferase Su(var)3-9 to histones (PubMed:11571273). Involved in position-effect variegation (PEV) (PubMed:11571273). In the larval brain, part of a regulatory network including the transcriptional repressors klu, dpn and E(spl)mgamma-HLH which is required for type II neuroblast self-renewal and for maintaining erm in an inactive state in intermediate neural progenitors (INP) (PubMed:28245922). H2O + N(6)-acetyl-L-lysyl-[histone] = acetate + L-lysyl-[histone] Component of a form of the Esc/E(z) complex present specifically during early embryogenesis which is composed of Caf1-55, esc, E(z), Su(z)12, Pcl and HDAC1 (PubMed:12533794, PubMed:12408863, PubMed:12697833). The Esc/E(z) complex may also associate with Pcl and HDAC1 during early embryogenesis (PubMed:12697833). This complex is distinct from the PRC1 complex, which contains many other PcG proteins like Pc, Ph, Psc, Su(z)2 (PubMed:12533794). The 2 complexes however cooperate and interact together during the first 3 hours of development to establish PcG silencing (PubMed:12533794). Interacts with the histone methyltransferase Su(var)3-9 (PubMed:11571273). Component of a complex that contains at least HDAC1, CoRest and Su(var)3-3/Hdm (PubMed:15306652). Component of the DREAM complex at least composed of Myb, Caf1-55, mip40, mip120, mip130, E2f2, Dp, Rbf, Rbf2, lin-52, HDAC1 and l(3)mbt (PubMed:15545624). Interacts with the chromatin-remodeler Mi-2 (PubMed:18250149). RNAi-mediated knockdown results in loss of type II neuroblasts. Belongs to the histone deacetylase family. HD type 1 subfamily.