The enrichment of mobile genetic elements in heterochromatin may be due, in part, to targeted integration. The chromoviruses are Ty3/gypsy retrotransposons with chromodomains at their integrase C termini. Chromodomains are logical determinants for targeting to heterochromatin, because the chromodomain of heterochromatin protein 1 (HP1) typically recognizes histone H3 K9 methylation, an epigenetic mark characteristic of heterochromatin. We describe three groups of chromoviruses based on amino acid sequence relationships of their integrase C termini. Genome sequence analysis indicates that representative chromoviruses from each group are enriched in gene-poor regions of the genome relative to other retrotransposons, and when fused to fluorescent marker proteins, the chromodomains target proteins to specific subnuclear foci coincident with heterochromatin. The chromodomain of the fungal element, MAGGY, interacts with histone H3 dimethyl- and trimethyl-K9, and when the MAGGY chromodomain is fused to integrase of the Schizosaccharomyces pombe Tf1 retrotransposon, new Tf1 insertions are directed to sites of H3 K9 methylation. Repetitive sequences such as transposable elements trigger the RNAi pathway resulting in their epigenetic modification. Our results suggest a dynamic interplay between retrotransposons and heterochromatin, wherein mobile elements recognize heterochromatin at the time of integration and then perpetuate the heterochromatic mark by triggering epigenetic modification.