Modification of histones can have a dramatic impact on chromatin structure
and function. Acetylation of lysines within the N-terminal tail of the hist
one octamer marks transcriptionally active regions of the genome whereas de
acetylation seems to play a role in transcriptional silencing. Recently, th
e methylation of the histone tails has also been shown to be important for
transcriptional regulation and chromosome structure. Here we show by immuno
affinity purification that two activities important for chromatin-mediated
gene silencing, the histone methyltransferase SU(VAR)3-9 and the histone de
acetylase HDAC1, associate in vivo. The two activities cooperate to methyla
te pre-acetylated histones. Both enzymes are modifiers of position effect v
ariegation and interact genetically in flies. We suggest a model in which t
he concerted histone deacetylation and methylation by a SU(VAR)3-9/HDAC1-co
ntaining complex leads to a permanent silencing of transcription in particu
lar areas of the genome.