Chromatin-mediated transcriptional states are central to gene regulation in development and environmental response, with co-transcriptional processes involved in their establishment. Quantitative regulation of Arabidopsis FLOWERING LOCUS C (FLC) is key to determining reproductive strategy. Low FLC expression underpins rapid-cycling and is established through a transcription-coupled chromatin mechanism. Proximal termination of antisense transcripts is linked to histone 3 lysine 4 demethylation of adjacent chromatin that leads to stable Polycomb Repressive Complex 2 (PRC2) silencing. However, how the termination-induced chromatin environment influences the switch to PRC2 silencing is still unclear. Here, we combine molecular approaches with theory to develop a dynamic mathematical model that incorporates sense/antisense transcription, alternative termination sites, and the interplay of these processes with varying levels of activating (H3K4me1)/silencing (H3K27me3) histone modifications. The model captures different feedback mechanisms between co-transcriptional 3′ processing and chromatin modifications, detailing how proximal co-transcriptional polyadenylation/termination can set the subsequent level of productive transcription via removal of H3K4 monomethylation across the locus. Since transcription universally antagonizes Polycomb silencing, this dictates the degree of antagonism to H3K27me3, thus determining the rate at which Polycomb repression is established. These principles are likely to be central to regulating transcriptional output at many targets and generally relevant for Polycomb silencing in many genomes.