In eukaryotic cells, genetic information is organized in a highly conserved structural polymer, termed chromatin, which is composed of repeating subunits called nucleosomes. Emerging evidence suggests that covalent modifications of histones have pronounced roles in chromatin structure and function (3,34,48). For instance, acetylation and deacetylation of the lysine residues at the histone N-terminal tails correlate in general with transcriptional activation and repression, respectively (30). The recent identification of enzyme systems carrying out histone modifications, together with the discovery of binding proteins that "read" covalent marks on histones, has led to the proposal that the pattern of modifications acts as an information code that influences gene transcription (12,20,31,33,35).While it is evident that histone modifications can have profound effects on transcription, it is much less clear as to how different histone codes are recognized and utilized. Current studies appear to suggest that once a code is generated, it can serve as an independent signal that allows the recruitment of a downstream regulatory protein(s). For instance, the bromodomain of TAFII250 and the chromodomain of HP1 are capable of binding acetylated histone tails and the K9 methylated H3 tails in vitro, respectively (2, 19, 21). Furthermore, K9 methylation is required for heterochromatin association of HP1 in cells (28). As a histone code involved in transcriptional activation, a recent study showed that acetylation of H4 on lysines 8 and 12 is sufficient for recruitment of TFIID at least in vitro, presumably through the double bromodomains in TAFII250(1). However, exactly how these various codes are recognized and utilized in vivo is not clear.Identified initially as corepressors for nuclear receptors such as thyroid hormone receptors (TR) and retinoic acid receptors (6, 17), N-CoR and SMRT are related proteins and have also been implicated in repression by many other transcription factors, including Mad/Mxi, BCL6/LAZ3, ETO, and CBF {for a review, see reference 14). Recent biochemical studies reveal that both SMRT and N-CoR exist in large protein complexes with an estimated size of 1.5 to 2 MDa and containing a set of core subunits, including histone deacetylase 3 (HDAC3), GPS2, TBL1 (transducin beta-like protein 1), and TBLR1 (TBL1-related protein) (16,23,36,37,41,44). Human TBL1 and TBLR1 are highly related WD-40 repeat proteins, sharing 89% sequence identity. A redundant function of TBL1/TBLR1 in repression was revealed by a recent study using small interfering RNA (siRNA) to TBL1 and TBLR1 (41). Both TBL1 and TBLR1 can bind histones H2B and H4 in vitro (41), raising question as to whether these proteins are involved in potential histone code recognition during repression by SMRT/N-CoR complexes. The presence of TBL1 and TBLR1 in the HDAC3-containing SMRT/N-CoR complexes is reminiscent of the RbAp46 and RbAp48 (also highly related WD-40 repeat proteins) in the HDAC1/2-containing Sin3 and NURD complexes (40,45,46). In vitro r...