The ura4+ gene displays phenotypes consistent with variegated expression when inserted at 11 sites throughout fission yeast centromere 1. An abrupt transition occurs between the zone of centromeric repression and two adjacent expressed sites. Mutations in six genes alleviate repression of the silent-mating type loci and of ura4+ expressed from a site adjacent to the silent locus, mat3-M. Defects at all six loci affect repression of the ura4+ gene adjacent to telomeres and at the three centromeric sites tested. The clr4-S5 and rik1-304 mutations cause the most dramatic derepression at two out of three sites within cen1. All six mutations had only slight or intermediate effects on a third site in the center of cen1 or on telomeric repression. Strains with lesions at the clr4, rik1, and swi6 loci have highly elevated rates of chromosome loss. We propose that the products of these genes are integral in the assembly of a heterochromatin-like structure, with distinct domains, enclosing the entire centromeric region that reduces or excludes access to transcription factors. The formation of this heterochromatic structure may be an absolute requirement for the formation of a fully functional centromere.