Heterochromatin is defined as regions of compact chromatin that persist throughout the cell cycle (Heitz, 1928). The earliest cytological observations of heterochromatin were followed by ribonucleotide labeling experiments that showed it to be transcriptionally inert relative to the more typical euchromatic regions that decondense during interphase. Genetic studies of rearrangements that place euchromatic genes next to blocks of heterochromatin also pointed out the repressive nature of heterochromatin (Grigliatti, 1991; and references therein). The discovery of the heterochromatin-enriched protein heterochromatin protein 1 (HP1)**Abbreviation used in this paper: HP1, heterochromatin protein 1. by Elgin and co-workers in the mid-1980s suggested that the distinct cytological features of this chromatin may be related to its unique nucleoprotein composition (James and Elgin, 1986; James et al., 1989). HP1 immunostaining on polytene chromosomes from Drosophila larval salivary glands was used to show enrichment of the protein in pericentric heterochromatin. Since that initial discovery, HP1 homologues have been found in species ranging from fission yeast to humans where it is associated with gene silencing (Eissenberg and Elgin, 2000; and references therein). A number of euchromatic sites of localization were also reported in this original study. It has been generally assumed that these sites might constitute euchromatic sites of transcriptional repression by HP1. Indeed, several genes located at one of these sites (cytological region 31) have increased transcript levels in mutants for HP1 (Hwang et al., 2001).