Cells from a "knock-in" mouse expressing a NF-B p65 mutant bearing an alanine instead of serine at position 276 (S276A) display a significant reduction of NF-B-dependent transcription, even though the mutant p65 forms appropriate complexes that translocate normally to the nucleus and bind to DNA. Surprisingly, however, instead of the expected embryonic lethality from hepatocyte apoptosis seen in the absence of NF-B activity, the S276A knock-in embryos die at different embryonic days due to variegated developmental abnormalities. We now demonstrate that this variegated phenotype is due to epigenetic repression resulting from the recruitment of histone deacetylases by the nonphosphorylatable form of NF-B into the vicinity of genes positioned fortuitously near NF-B-binding sites. Therefore, unphosphorylated nuclear NF-B can affect expression of genes not normally regulated by NF-B through epigenetic mechanisms.[Keywords: Epigenetics; inflammation; NF-B; gene expression; phosphorylation] Supplemental material is available at http://www.genesdev.org. The transcription factor NF-B plays a critical role in the inducible expression of genes involved in many biological processes (Baldwin 1996;Ghosh et al. 1998). In unstimulated cells, NF-B exists in the cytosol, bound to inhibitory IB proteins. Stimulation of cells leads to the activation of the IB kinase (IKK) complex, which then phosphorylates IB proteins on two N-terminal serine residues, leading to its polyubiquitination and subsequent degradation by the proteasome. The released NF-B translocates to the nucleus, binds to cognate sites in the promoters of responsive genes, and induces their expression. This cytoplasmic-to-nuclear translocation has remained a paradigm for inducible transcription factors, and it has been assumed that, once NF-B reached the nucleus, it would be capable of driving transcription. However, recent studies have begun to suggest that such a model might be too simplistic and may fail to account for the complexity that underlies the process of NF-B activation (Chen and Greene 2004;Hayden and Ghosh 2004;Vermeulen et al. 2006).A hint that the transcriptional activity of NF-B requires additional regulatory steps first came from biochemical studies where the catalytic subunit of cAMPdependent protein kinase (PKAc) was found to copurify with cytosolic NF-B:IB complexes (Zhong et al. 1997). Subsequent analysis indicated that in response to specific stimuli PKAc phosphorylates the p65 NF-B subunit at a consensus PKA phosphorylation site located within the Rel homology domain. Overexpression experiments suggested that mutation of this serine residue at position 276 to alanine (S276A) abolishes the ability of the transfected p65 protein to drive transcription, even though the mutant protein can assemble into complexes with other Rel proteins and IBs and bind normally to DNA (Zhong et al. 1997(Zhong et al. , 1998. Further studies showed that phosphorylation of p65 at Ser 276 allows efficient recruitment of the coactivator CREB-binding protein (CBP)/p300 a...