TIF1β is a developmentally regulated transcriptional corepressor proposed to function by reorganizing higher-order chromatin structure. It is essential for early embryogenesis and interacts with heterochromatin-associated protein 1 (HP1), a heterochromatin component implicated in Drosophila position effect variegation — the heritable pattern of silencing produced by positioning of genes close to pericentric heterochromatin. Speculating that nuclear compartmentalization of TIF1β might be important for its function, Pierre Chambon and co-workers have examined its subnuclear distribution during differentiation of F9 embryonal carcinoma cells (see p. 3439). They find that TIF1β has a dispersed (euchromatic)distribution in the nucleoplasm of undifferentiated cells but relocates to centromeric heterochromatin following differentiation induced by retinoic acid. No such relocation occurs in growth-arrested cells or RA-resistant cells. The authors show that mutation of the TIF1β PxVxL motif that mediates interactions with HP1 blocks targeting of TIF1β to centromeric heterochromatin. They therefore conclude that nuclear compartmentalization of TIF1β is dynamically regulated by HP1 interaction during differentiation,speculating that TIF1β might mediate cell-type-specific gene silencing by recruiting target genes to the transcriptionally inactive heterochromatic compartment.