Abstract: Bromodomains bind acetylated histone H4 peptides in vitro. Since many chromatin remodeling complexes and the general transcription factor TFIID contain bromodomains, they may link histone acetylation to increased transcription. Here we show that yeast Bdf1 bromodomains recognize endogenous acetyl-histone H3/H4 as a mechanism for chromatin association in vivo. Surprisingly, deletion of BDF1 or a Bdf1 mutation that abolishes histone binding leads to transcriptional downregulation of genes located at heterochromatin-euchromatin boundaries. Wild-type Bdf1 protein imposes a physical barrier to the spreading of telomere- and mating-locus-proximal SIR proteins. Biochemical experiments indicate that Bdf1 competes with the Sir2 deacetylase for binding to acetylated histone H4. These data suggest an active role for Bdf1 in euchromatin maintenance and antisilencing through a histone tail-encoded boundary function.