Purpose: Malignant rhabdoid tumor (MRT) and atypical teratoid rhabdoid tumors (ATRT) are rare aggressive undifferentiated tumors primarily affecting the kidney and CNS of infants and young children. MRT are almost exclusively characterized by homozygous deletion or inactivation of the chromatin remodeling gene SMARCB1. SMARCB1 protein loss leads to direct impairment of chromatin remodeling and we have previously reported a role for this protein in histone acetylation. This provided the rationale for investigating the therapeutic potential of histone deactylase inhibitors (HDACi) in MRT. Experimental Design: Whereas previously HDACis have been used at doses and schedules that induce cytotoxicity, in the current studies we have tested the hypothesis, both in vitro and in vivo, that sustained treatment of human MRT with lowdose HDACi can lead to sustained cell growth arrest and differentiation. Results: Sustained low-dose panobinostat (LBH589) treatment led to changes in cellular morphology associated with a marked increase in the induction of neural, renal, and osteoblast differentiation pathways. Genome-wide transcriptional profiling highlighted differential gene expression supporting multilineage differentiation. Using mouse xenograft models, sustained lowdose LBH589 treatment caused tumor growth arrest associated with tumor calcification detectable by X-ray imaging. Histological analysis of LBH589-treated tumors revealed significant regions of ossification, confirmed by Alizarin Red staining. Immunohistochemical analysis showed increased TUJ1 and PAX2 staining suggestive of neuronal and renal differentiation, respectively. Conclusions: Low-dose HDACi treatment can terminally differentiate MRT tumor cells and reduce their ability to self-renew. The use of low-dose HDACi as a novel therapeutic approach warrants further investigation.