SUMO conjugation is known to occur in response to double‐stranded DNA breaks in mammalian cells, but whether SUMO deconjugation has a role remains unclear. Here, we show that the SUMO/Sentrin/Smt3‐specific peptidase, SENP7, interacts with the chromatin repressive KRAB‐associated protein 1 (KAP1) through heterochromatin protein 1 alpha (HP1α). SENP7 promotes the removal of SUMO2/3 from KAP1 and regulates the interaction of the chromatin remodeler CHD3 with chromatin. Consequently, in the presence of CHD3, SENP7 is required for chromatin relaxation in response to DNA damage, for homologous recombination repair and for cellular resistance to DNA‐damaging agents. Thus, deSUMOylation by SENP7 is required to promote a permissive chromatin environment for DNA repair. This study shows that SENP7 removes SUMO from KAP1, regulating the interaction of CHD3 with chromatin. In the presence of CHD3, SENP7 is required for chromatin relaxation in response to DNA damage, the ensuing repair and resistance to DNA damaging agents.