Epigenetics is the study of heritable changes in gene expression that are not mediated at the DNA sequence level. Molecular mechanisms that mediate epigenetic regulation include DNA methylation and chromatin/histone modifications. With the identification of key histone-modifying enzymes, the biological functions of many histone posttranslational modifications are now beginning to be elucidated. Histone methylation, in particular, plays critical roles in many epigenetic phenomena. In this review, we provide an overview of recent findings that shape the current paradigms regarding the roles of histone methylation and histone variants in heterochromatin assembly and the maintenance of the boundaries between heterochromatin and euchromatin. We also highlight some of the enzymes that mediate histone methylation and discuss the stability and inheritance of this modification.