Tissue-specific patterns of methylated deoxycytidine residues in the mammalian genome are preserved by postreplicative methylation of newly synthesized DNA. DNA methyltransferase (MTase) is here shown to associate with replication foci during S phase but to display a diffuse nucleoplasmic distribution in non-S phase cells. Analysis of DNA MTase-beta-galactosidase fusion proteins has shown that association with replication foci is mediated by a novel targeting sequence located near the N-terminus of DNA MTase. This sequence has the properties expected of a targeting sequence in that it is not required for enzymatic activity, prevents proper targeting when deleted, and, when fused to beta-galactosidase, causes the fusion protein to associate with replication foci in a cell cycle-dependent manner.