Yeast chromosomes may lack the linker histone H1 (normally required to compact 10 nm beads-on-a-string fiber into the 30 nm fiber) and there is no cytological evidence for higher order fiber structure but they do contain regions which correspond to euchromatin and heterochromatin of higher eukaryotes. Both euchromatin and heterochromatin contain nucleosomal particles (composed of two molecules each of H2A, H2B, H3 and H4), however histones have been shown to regulate genes in these regions in quite different ways. The mechanisms by which such regulation occurs are the topic of this paper.