Known as Mostaza (mustard) because of his off-blond hair, Merlo played his entire career for Club Atlético River Plate as a defensive midfielder. He was part of the midfield that conquered a string of championships under coach Ángel Labruna between 1975 and 1981, the others being Juan José López and Norberto Alonso.
Merlo was, together with goalkeeper Ubaldo Fillol and defender Daniel Passarella, the backbone of that team. River, nonetheless, purchased several players to fill in Merlo's position, because he was considered a great defender, but a liability once the team got the ball. Among them were Ramiro Pérez, Chamaco Rodríguez, Della Savia, Cierra, Carranza, Pitarch, de los Santos, and Américo Gallego, who ultimately earned Merlo's position. Before retirement, Merlo mentored an up-and-coming midfielder: Néstor Gorosito. Both Gallego and Gorosito have since met Merlo as rival coaches.
Merlo made over 500 appearances for River. He won seven titles during his time at the club and made 42 appearances in the Superclasico, more than any other player in history.