Post-replicative correction of replication errors by the mismatch repair (MMR) system is critical for suppression of mutations. Although the MMR system may need to handle nucleosomes at the site of chromatin replication, how MMR occurs in the chromatin environment remains unclear. Here, we show that nucleosomes are excluded from a >1-kb region surrounding a mismatched base pair in Xenopus egg extracts. The exclusion was dependent on the Msh2-Msh6 mismatch recognition complex but not the Mlh1-containing MutL homologs and counteracts both the HIRA- and CAF-1 (chromatin assembly factor 1)-mediated chromatin assembly pathways. We further found that the Smarcad1 chromatin remodeling ATPase is recruited to mismatch-carrying DNA in an Msh2-dependent but Mlh1-independent manner to assist nucleosome exclusion and that Smarcad1 facilitates the repair of mismatches when nucleosomes are preassembled on DNA. In budding yeast, deletion of FUN30, the homolog of Smarcad1, showed a synergistic increase of spontaneous mutations in combination with MSH6 or MSH3 deletion but no significant increase with MSH2 deletion. Genetic analyses also suggested that the function of Fun30 in MMR is to counteract CAF-1. Our study uncovers that the eukaryotic MMR system has an ability to exclude local nucleosomes and identifies Smarcad1/Fun30 as an accessory factor for the MMR reaction.