Mammalian SET domain-containing proteins define a distinctive class of chromatin-associated factors that are targets for growth control signals and oncogenic activation. SUV39H1, a mammalian ortholog of Drosophila Su(var)3-9, contains both SET and chromo domains, signature motifs for proteins that contribute to epigenetic control of gene expression through effects on the regional organization of chromatin structure. In this report we demonstrate that SUV39H1 represses transcription in a transient transcriptional assay when tethered to DNA through the GAL4 DNA binding domain. Under these conditions, SUV39H1 displays features of a long-range repressor capable of acting over several kilobases to silence basal promoters. A possible role in chromatin-mediated gene silencing is supported by the localization of exogenously expressed SUV39H1 to nuclear bodies with morphologic features suggestive of heterochromatin in interphase cells. In addition, we show that SUV39H1 is phosphorylated specifically at the G(1)/S cell cycle transition and when forcibly expressed suppresses cell growth. Growth suppression as well as the ability of SUV39H1 to form nuclear bodies and silence transcription are antagonized by the oncogenic antiphosphatase Sbf1 that when hyperexpressed interacts with the SET domain and stabilizes the phosphorylated form of SUV39H1. These studies suggest a phosphorylation-dependent mechanism for regulating the chromatin organizing activity of a mammalian su(var) protein and implicate the SET domain as a gatekeeper motif that integrates upstream signaling pathways to epigenetic regulation and growth control.