Variants in the poorly characterised oncoprotein, MORC2, a chromatin remodelling ATPase, lead to defects in epigenetic regulation and DNA damage response. MORC2 variants are associated with multiple cancers and neurological disorders1,2. The C-terminal domain (CTD) of MORC2 is often phosphorylated in DNA damage response and is known to induce cancer progression in in vivo and in vitro cancer models3-5. However, it remains unclear how MORC2 CTD and its phosphorylation impacts its chromatin remodelling activity. Here, we report a molecular characterisation of full-length, phosphorylated MORC2. We show that MORC2 preferentially binds open chromatin, has multiple DNA binding sites with varying affinities and acts as a DNA sliding clamp. We identified a phosphate interacting motif within the CTD that dictates ATP hydrolysis and cooperative DNA binding. The DNA binding impacts several structural domains within the N-terminal ATPase region. We provide the first visual proof that MORC2 induces chromatin remodelling through ATP hydrolysis-dependent DNA compaction, where the speed of compaction is affected by its phosphorylation state. Together, our results reveal that phosphorylation of MORC2 CTD modulates its chromatin remodelling and could be an attractive target for therapeutics.