Deletion of native centromeres in the human fungal pathogen Cryptococcus deuterogattii leads to neocentromere formation. Native centromeres span truncated transposable elements, while neocentromeres span actively expressed genes. Neocentromeres in cen10∆ mutants are unstable and chromosome-chromosome fusions occur. After chromosome fusion, the neocentromere is silenced and the native centromere of the chromosome fusion partner remains as the sole active centromere. In the present study, the active centromere of a fused chromosome was deleted to investigate if epigenetic memory promoted re-activation of a silenced neocentromere. Our results show that the silenced neocentromere is not re-activated and instead a novel neocentromere forms directly adjacent to the deleted centromere of the fused chromosome. To explore the epigenetic organization of neocentromeres, we characterized the distribution of the heterochromatic histone modification H3K9me2 and 5mC DNA methylation. Native centromeres were enriched for both H3K9me2 and 5mC DNA methylation marks, while neocentromeres lacked these specific histone and DNA modifications. To study centromere dynamics, the actively expressed URA5 gene was introduced into a native centromere. Introduction of the URA5 gene led to loss of CENP-A from the native centromere, and a neocentromere formed directly adjacent to the native centromere location. Remarkably, the silenced native centromere remained enriched for heterochromatin, yet the integrated gene was expressed and devoid of H3K9me2. Analysis of multiple CENP-A distribution profiles revealed centromere drift in C. deuterogattii, a previously unknown phenomenon in fungi. The CENP-A- enriched region shifted within the pericentric regions, and a truncated transposable element in centromere 5 acted as a barrier between the CENP-A-associated regions of chromatin. Interestingly, this truncated transposable element was devoid of CENP-A binding or H3K9me2 modification and was instead marked by 5mC DNA methylation. Taken together, our findings reveal novel aspects about the epigenetic mechanisms that distinguish native centromeres and neocentromeres.