Establishment and maintenance of silent chromatin in the Saccharomyces cerevisiae involves a step-wise assembly of the SIR complex. Here we demonstrate a role for the protein arginine methyltransferase Hmt1 in this process. In the absence of catalytically active Hmt1, yeast cells display increased transcription from silent chromatin regions and increased mitotic recombination within tandem repeats of rDNA. At the molecular level, loss of Hmt1's catalytic activity results in decreased Sir2 and dimethylated Arg-3 histone H4 occupancy across silent chromatin regions. These data suggest a model whereby protein arginine methylation affects the establishment and maintenance of silent chromatin. Received April 11, 2006; revised version accepted October 23, 2006. In a eukaryotic cell, different chromosomal regions display varying degrees of transcriptional competency. This is the result of selective transcriptional repression or silencing that renders specific chromatin domains inaccessible to the transcriptional machinery. Analogous to metazoan heterochromatin, there are three chromosomal regions in the yeast Saccharomyces cerevisiae that are epigenetically transcriptionally silenced (Rusche et al. 2003); the telomeres, the silent mating loci (HMR and HML), and the rDNA loci. Within these regions are cisacting elements known as silencers and telomeric repeats that serve as nucleation points to recruit transacting proteins responsible for the establishment and maintenance of silent chromatin.One of the most prominent trans-acting proteins involved in the establishment and maintenance of silencing at these loci is Silent Information Regulator-2 (Sir2), an NAD + -dependent histone deacetylase (Blander and Guarente 2004). Sir2 plays a crucial role in the formation of silent chromatin. In addition, Sir2 is involved in the maintenance of genome stability via the repair of doublestranded DNA breaks by nonhomologous recombination. For example, Sir2 is recruited to sites of DNA strand breaks (Martin et al. 1999;Mills et al. 1999) and Sir2-dependent localized histone acetylation triggers the homologous recombination pathway of double-strand DNA repair (Tamburini and Tyler 2005).Sir2 forms complexes with different proteins to promote silencing. For example, the Sir1/2/3/4 complex functions to silence transcription at the mating-type loci, whereas a Sir2/3/4 complex mediates silencing at the telomeres (Kaeberlein et al. 1999). At the rDNA, Sir2 associates with Cdc14 and Net1 to form the RENT (regulator of the nucleolar silencing and telophase exit) complex (Ghidelli et al. 2001). These complexes are thought to promote the formation of silent chromatin through stepwise propagation along the DNA (Hoppe et al. 2002).Arginine methylation is a post-translational modification commonly found in nucleic acid-binding proteins (Bedford and Richard 2005). The enzyme that catalyzes this modification belongs to a growing enzyme family called protein arginine methyltransferases or PRMTs. Arginine residues may be either monomethylated or di...