DNA methylation promotes transcription: DNA methylation generally represses transcription, but in some instances, it has also been implicated in transcription activation. Harris et al. identified a protein complex in Arabidopsis that is recruited to chromatin by DNA methylation. This complex specifically activated the transcription of genes that are already mildly transcribed but had no effect on transcriptionally silent genes such as transposable elements. The complex thereby counteracts the repression effect caused by transposon insertion in neighboring genes while leaving transposons silent. Thus, by balancing both repressive and activating transcriptional effects, DNA methylation can act to fine-tune gene expression. Science , this issue p. 1182

The epigenetic inheritance of DNA methylation requires UHRF1, a histone- and DNA-binding RING E3 ubiquitin ligase that recruits DNMT1 to sites of newly replicated DNA through ubiquitylation of histone H3. UHRF1 binds DNA with selectivity towards hemi-methylated CpGs (HeDNA); however, the contribution of HeDNA sensing to UHRF1 function remains elusive. Here, we reveal that the interaction of UHRF1 with HeDNA is required for DNA methylation but is dispensable for chromatin interaction, which is governed by reciprocal positive cooperativity between the UHRF1 histone- and DNA-binding domains. HeDNA recognition activates UHRF1 ubiquitylation towards multiple lysines on the H3 tail adjacent to the UHRF1 histone-binding site. Collectively, our studies are the first demonstrations of a DNA-protein interaction and an epigenetic modification directly regulating E3 ubiquitin ligase activity. They also define an orchestrated epigenetic control mechanism involving modifications both to histones and DNA that facilitate UHRF1 chromatin targeting, H3 ubiquitylation, and DNA methylation inheritance.