Telomeric regions contain prominent sites of heterochromatin, which is associated with unique histone modification profiles such as the methylation of histone H3 at Lys9 (H3K9me). In fission yeast, the conserved telomeric shelterin complex recruits the histone H3K9 methyltransferase complex CLRC to establish subtelomeric heterochromatin. Although many shelterin mutations affect subtelomeric heterochromatin assembly, the mechanism remains elusive due to the diverse functions of shelterin. Through affinity purification, we found that shelterin directly associates with CLRC through the Ccq1 subunit. Surprisingly, mutations that disrupt interactions between shelterin subunits compromise subtelomeric heterochromatin without affecting CLRC interaction with shelterin component Pot1, located at chromosome ends. We further discovered that telomeric repeats are refractory to heterochromatin spreading and that artificial restoration of shelterin connections or increased heterochromatin spreading rescued heterochromatin defects in these shelterin mutants. Thus, subtelomeric heterochromatin assembly requires both the recruitment of CLRC by shelterin to chromosome ends and the proper connection of shelterin components, which allows CLRC to skip telomeric repeats to internal regions. 