Methyl-CpG-binding protein 2 (MeCP2) is an essential chromatin-binding protein whose mutations cause Rett syndrome (RTT), a severe neurological disorder that primarily affects young females. The canonical view of MeCP2 as a DNA methylation-dependent transcriptional repressor has proven insufficient to describe its dynamic interaction with chromatin and multifaceted roles in genome organization and gene expression. Here we used single-molecule correlative force and fluorescence microscopy to directly visualize the dynamics of wild-type and RTT-causing mutant MeCP2 on DNA. We discovered that MeCP2 exhibits distinct one-dimensional diffusion kinetics when bound to unmethylated versus CpG methylated DNA, enabling methylation-specific activities such as co-repressor recruitment. We further found that, on chromatinized DNA, MeCP2 preferentially localizes to nucleosomes and stabilizes them from mechanical perturbation. Our results reveal the multimodal behavior of MeCP2 on chromatin that underlies its DNA methylation- and nucleosome-dependent functions and provide a biophysical framework for dissecting the molecular pathology of RTT mutations.