Histone methylation by histone methyltransferases (HMTases) has a key role in transcriptional regulation. Discrepancies between the known HMTases and the histone lysine methylome suggest that HMTases remain to be identified. Here we report the discovery, characterization, and crystal structure of Schizosaccharomyces pombe Set7, an HMTase methylating the uncharted histone H3 lysine 37 (H3K37) mark. Set7 forms a dimer with its substrate-binding site structurally specific to K37, not the neighboring well-studied K36 mark. We also discovered that H3K37 methylation levels dramatically increase during gametogenesis. Set7 deletion mutant cells show defects in gametogenesis and produce the abnormal number of spores with aberrant morphology. S. pombe gametogenesis shares similarities with mammalian spermatogenesis. These findings extend our understanding of epigenetic regulation during gametogenesis and support a link between Set7, the epigenetic H3K37 methyl mark, and proper gametogenesis.