Heritable inactivation of genes occurs in specific chromosomal domains located at the silent mating type loci and at telomeres of S. cerevisiae. The SIR genes (for silent information regulators) are trans-acting factors required for this repression mechanism. We show here that the SIR3 and SIR4 gene products have a sub-nuclear localization similar to the telomere-associated RAP1 protein, which is found primarily in foci at the nuclear periphery of fixed yeast spheroplasts. In strains deficient for either SIR3 or SIR4, telomeres lose their perinuclear localization, as monitored by RAP1 immunofluorescence. The length of the telomeric repeat shortens in sir3 and sir4 mutant strains, and the mitotic stability of chromosome V is reduced. These data suggest that SIR3 and SIR4 are required for both the integrity and subnuclear localization of yeast telomeres, the loss of which correlates with loss of telomere-associated gene repression.