Eukaryotic heterochromatin is characterized by a high density of repeats and transposons, as well as by modified histones, and influences both gene expression and chromosome segregation. In the fission yeast Schizosaccharomyces pombe, we deleted the argonaute, dicer, and RNA-dependent RNA polymerase gene homologs, which encode part of the machinery responsible for RNA interference (RNAi). Deletion results in the aberrant accumulation of complementary transcripts from centromeric heterochromatic repeats. This is accompanied by transcriptional de-repression of transgenes integrated at the centromere, loss of histone H3 lysine-9 methylation, and impairment of centromere function. We propose that double-stranded RNA arising from centromeric repeats targets formation and maintenance of heterochromatin through RNAi.

The assembly of higher order chromatin structures has been linked to the covalent modifications of histone tails. We provide in vivo evidence that lysine 9 of histone H3 (H3 Lys9) is preferentially methylated by the Clr4 protein at heterochromatin-associated regions in fission yeast. Both the conserved chromo- and SET domains of Clr4 are required for H3 Lys9 methylation in vivo. Localization of Swi6, a homolog of Drosophila HP1, to heterochomatic regions is dependent on H3 Lys9 methylation. Moreover, an H3-specific deacetylase Clr3 and a beta-propeller domain protein Rik1 are required for H3 Lys9 methylation by Clr4 and Swi6 localization. These data define a conserved pathway wherein sequential histone modifications establish a "histone code" essential for the epigenetic inheritance of heterochromatin assembly.

The formation of heterochromatin, which requires methylation of histone H3 at lysine 9 and the subsequent recruitment of chromodomain proteins such as heterochromatin protein HP1, serves as a model for the role of histone modifications and chromatin assembly in epigenetic control of the genome. Recent studies in Schizosaccharomyces pombe indicate that heterochromatin serves as a dynamic platform to recruit and spread a myriad of regulatory proteins across extended domains to control various chromosomal processes, including transcription, chromosome segregation and long-range chromatin interactions.

RNA interference (RNAi) is a widespread silencing mechanism that acts at both the posttranscriptional and transcriptional levels. Here, we describe the purification of an RNAi effector complex termed RITS (RNA-induced initiation of transcriptional gene silencing) that is required for heterochromatin assembly in fission yeast. The RITS complex contains Ago1 (the fission yeast Argonaute homolog), Chp1 (a heterochromatin-associated chromodomain protein), and Tas3 (a novel protein). In addition, the complex contains small RNAs that require the Dicer ribonuclease for their production. These small RNAs are homologous to centromeric repeats and are required for the localization of RITS to heterochromatic domains. The results suggest a mechanism for the role of the RNAi machinery and small RNAs in targeting of heterochromatin complexes and epigenetic gene silencing at specific chromosomal loci.