Gene expression during Drosophila development is subject to regulation by the Polycomb (Pc), Trithorax (Trx), and Compass chromatin modifier complexes. O-GlcNAc transferase (OGT/SXC) is essential for Pc repression suggesting that the O-GlcNAcylation of proteins plays a key role in regulating development. OGT transfers O-GlcNAc onto serine and threonine residues in intrinsically disordered domains of key transcriptional regulators; O-GlcNAcase (OGA) removes the modification. To pinpoint genomic regions that are regulated by O-GlcNAc levels, we performed ChIP-chip and microarray analysis after OGT or OGA RNAi knockdown in S2 cells. After OGA RNAi, we observed a genome-wide increase in the intensity of most O-GlcNAc-occupied regions including genes linked to cell cycle, ubiquitin, and steroid response. In contrast, O-GlcNAc levels were strikingly insensitive to OGA RNAi at sites of polycomb repression such as the Hox and NK homeobox gene clusters. Microarray analysis suggested that altered O-GlcNAc cycling perturbed the expression of genes associated with morphogenesis and cell cycle regulation. We then produced a viable null allele of oga (oga(del.1)) in Drosophila allowing visualization of altered O-GlcNAc cycling on polytene chromosomes. We found that trithorax (TRX), absent small or homeotic discs 1 (ASH1), and Compass member SET1 histone methyltransferases were O-GlcNAc-modified in oga(del.1) mutants. The oga(del.1) mutants displayed altered expression of a distinct set of cell cycle-related genes. Our results show that the loss of OGA in Drosophila globally impacts the epigenetic machinery allowing O-GlcNAc accumulation on RNA polymerase II and numerous chromatin factors including TRX, ASH1, and SET1.