The histone H2A variant H2A.Z (Saccharomyces cerevisiae Htz1) plays roles in transcription, DNA repair, chromosome stability, and limiting telomeric silencing. The Swr1-Complex (SWR-C) inserts Htz1 into chromatin and shares several subunits with the NuA4 histone acetyltransferase. Furthermore, mutants of these two complexes share several phenotypes, suggesting they may work together. Here we show that NuA4 acetylates Htz1 Lys 14 (K14) after the histone is assembled into chromatin by the SWR-C. K14 mutants exhibit specific defects in chromosome transmission without affecting transcription, telomeric silencing, or DNA repair. Functionspecific modifications may help explain how the same component of chromatin can function in diverse pathways. Two classes of enzymes have been implicated in regulating chromatin structure and access to the underlying DNA template. The ATP-dependent chromatin remodeling enzymes use ATP hydrolysis to induce nucleosome mobility or disrupt histone-DNA interactions. The second class of enzymes covalently modify (e.g., lysine acetylation, serine phosphorylation, lysine and arginine methylation, ubiquitylation, or ADP ribosylation) various histones, usually on their N-terminal tails (Strahl and Allis 2000; Jenuwein and Allis 2001). Acetylation is carried out by histone acetyltransferases (HATs), which in Saccharomyces cerevisiae include the Gcn5-containing ADA and SAGA complexes, Hat1, Elongator, NuA3, and NuA4 (for review, see Bottomley 2004). These typically have specificity for distinct lysine residues on certain histone N-terminal tails. The acetylation of lysine residues on the N-terminal tails of histones H3 and H4 neutralizes their positive charge, possibly decreasing their affinity for DNA and facilitating chromatin decompaction and disassembly (Eberharter and Becker 2002). Perhaps more important than simple charge neutralization is the specific pattern of acetylation at individual lysine residues, at least some of which recruit bromodomain-containing proteins (Matangkasombut and Buratowski 2003, and references therein).Further chromatin specialization can be introduced by incorporation of variant histones. The major histones are assembled during DNA replication, but can be replaced by variants at specific locations (for review, see The SWR-C shares several subunits with the NuA4 HAT complex (Kobor et al. 2004;Krogan et al. 2004;Mizuguchi et al. 2004), and expression microarray analysis shows the two complexes have common regulatory targets (Krogan et al. 2004). NuA4 is required for the majority of histone H4 acetylation on Lys 5 (K5), K8, and K12 and some on histone H2A K7 Allard et al. 1999). Htz1, SWR-C, and NuA4 have each been implicated in the maintenance of chromosome stability (Krogan et al. 2004). This function for H2A.Z is conserved in the fission yeast Schizosaccharomyces pombe (Carr et al. 1994) and metazoans (Rangasamy et al. 2004).How NuA4 and SWR-C are functionally connected remains unclear. Htz1 incorporation into chromatin is dependent on SWR-C, but independent of NuA...