Histone H3 methylated at lysine 4 (H3-meK4) co-localizes with hyperacetylated histones H3 and H4 in transcriptionally active chromatin, but mechanisms that establish H3-meK4 are poorly understood. Previously, we showed that the hematopoietic-specific activator NF-E2, which is required for -globin transcription in erythroleukemia cells, induces histone H3 hyperacetylation and H3-meK4 at the adult -globin genes (major and minor). Chromatin immunoprecipitation analysis indicated that NF-E2 occupies hypersensitive site two (HS2) of the -globin locus control region. The mechanism of NF-E2-mediated chromatin modification was investigated by complementation analysis in NF-E2-null CB3 erythroleukemia cells. The activation domain of the hematopoietic-specific subunit of NF-E2 (p45/NF-E2) contains two WW domainbinding motifs (PXY-1 and PXY-2). PXY-1 is required for activation of -globin transcription. Here, we determined which step in NF-E2-dependent transactivation is PXY-1-dependent. A p45/NF-E2 mutant lacking 42 amino acids of the activation domain, including both PXY motifs, and a mutant lacking only PXY-1 were impaired in inducing histone H3 hyperacetylation, H3-meK4, and RNA polymerase II recruitment. The PXY motifs were not required for transactivation in the context of a GAL4 DNA-binding domain fusion to p45/NF-E2 in transient transfection assays. As the PXY-1 mutant occupied HS2 normally, the chromatin modification defect occurred post-DNA binding. PXY-1 was not required for recruitment of the histone acetyltransferases cAMP-responsive elementbinding protein-binding protein (CBP) and p300 to HS2. These results indicate that PXY-1 confers chromatinspecific transcriptional activation via interaction with a co-regulator distinct from CBP/p300 or by regulating CBP/p300 function.Mechanisms that dynamically regulate chromatin structure at localized sites and over broad chromosomal regions are crucial for controlling nuclear processes such as transcription. A common mode of regulating chromatin structure is the posttranslational modification of core histones, of which histone acetylation is the most extensively studied (1, 2). Hyperacetylated histones are often enriched in transcriptionally active chromatin (3, 4), although reductions in acetylation can occur upon transcriptional activation (5). Acetylation impacts transcription in part by increasing DNA accessibility within the nucleosome (6) and by perturbation of higher order chromatin folding (7,8).Analogous to acetylation, methylation of lysine 4 of histone H3 (H3-meK4) 1 marks transcriptionally active chromatin (9 -13). By contrast, histone H3 methylated at lysine 9 is associated with transcriptional repression (14 -16). At least one mechanism by which H3-meK4 functions is by inhibiting binding of the nucleosome remodeling deacetylase repressor complex to the amino-terminal tail of histone H3, thereby favoring the transcriptionally active state (17). Acetylated and methylated lysines within histones can also function as ligands to bind bromodomain-and chromo...