A hallmark of histone H3 lysine 9 (H3K9) methylated heterochromatin, conserved from fission yeast,Schizosaccharomyces pombe (S. pombe), to humans, is its ability to spread to adjacent genomic regions(1–6). Central to heterochromatin spread is the heterochromatin protein 1 (HP1), which recognizes H3K9 methylated chromatin, oligomerizes, and forms a versatile platform that participates in diverse nuclear functions, ranging from gene silencing to chromosome segregation(1–6). How HP1 proteins assemble on methylated nucleosomal templates and how the HP1-nucleosome complex achieves functional versatility remain poorly understood. Here, we show that binding of the major S. pombe HP1 protein, Swi6, to methylated nucleosomes drives a switch from an auto-inhibited state to a spreading competent state. In the auto-inhibited state, a histone mimic sequence in one Swi6 monomer blocks methyl mark recognition by the chromodomain of another monomer. Auto-inhibition is relieved by recognition of two template features, the H3K9 methyl mark and nucleosomal DNA. Cryo-Electron Microscopy (EM) based reconstruction of the Swi6-nucleosome complex provides the overall architecture of the spreading-competent state in which two unbound chromodomain sticky ends appear exposed. Disruption of the switch between the auto-inhibited and spreading competent state disrupts heterochromatin assembly and gene silencing in vivo. These findings are reminiscent of other conditionally activated polymerization processes, such as actin nucleation, and open up a new class of regulatory mechanisms that operate on chromatin in vivo
