Methylation of histone H3 on lysine 9 is critical for diverse biological processes including transcriptional repression, heterochromatin formation, and X inactivation. The biological effects of histone methylation are thought to be mediated by effector proteins that recognize and bind to specific patterns of methylation. Using an unbiased in vitro biochemical approach, we have identified ICBP90, a transcription and cell cycle regulator, as a novel methyl K9 H3-specific binding protein. ICBP90 and its murine homologue Np95 are enriched in pericentric heterochromatin of interphase nuclei, and this localization is dependent on H3K9 methylation. Specific binding of ICBP90 to methyl K9 H3 depends on two functional domains, a PHD (plant homeodomain) finger that defines the binding specificity and an SRA (SET-and RING-associated) domain that promotes binding activity. Furthermore, we present evidence that ICBP90 is required for proper heterochromatin formation in mammalian cells.Covalent modifications of the histone tails regulate virtually all aspects of chromatin biology. In addition to affecting histone-histone and histone-DNA interactions, posttranslational marks on the histone tails exert their modulatory role by generating docking sites for downstream effectors. Such molecules, often possessing enzymatic activities, serve as readers of histone modifications and participate in vital cellular processes, including transcription, replication, chromosome segregation, recombination, and DNA repair (15,30,58).One of the most extensively studied histone tail modifications is methylation of histone H3 on lysine 9 (2). Histone H3 K9 methylation has been shown to be critical for regulation of gene expression, and it is enriched in transcriptionally inactive regions of the genome. It is considered a molecular mark of heterochromatin, the cytologically defined, gene-poor, and highly compacted regions of the chromatin. Interplay between H3 K9 methylation and DNA methylation has also been proposed in various models of heterochromatin formation and maintenance (32,43,51,65). Furthermore, H3 K9 methylation is implicated in gene silencing phenomena such as X chromosome inactivation in female mammals and DNA elimination in the microscopic protozoon Tetrahymena (4, 60).Several mammalian proteins, including SUV39H1, SUV39H2, G9a, ESET/SETDB1, and EuHTMase1, have been shown to have methyltransferase activity toward K9 of H3 (46,47,54,56,59,72). Though they target the same histone residue, important differences exist among the above enzymes regarding their chemistry and distribution and consequently their biological roles. The reversibility of H3 K9 methylation has been an object of speculation for many years. Evidence for the removal of this covalent mark was obtained recently with the identification of specific histone demethylases (10,17,34,40,66,67,71). Although reversible, methylation appears to be much more stable compared to other histone modifications. Therefore, it is considered to play a major role in the establishment and ma...