Noncoding RNAs can modulate gene expression by directing modifications to histones that alter chromatin structure. In fission yeast, siRNAs produced via the RNAi pathway direct modifications associated with heterochromatin formation. siRNAs associate with the RNAi effector protein Argonaute 1 (Ago1), targeting the Ago1-containing RNA-induced transcriptional silencing (RITS) complex to homologous nascent transcripts. This promotes recruitment of the Clr4 complex (CLRC), which mediates methylation of histone H3 on lysine 9 (H3K9me) in cognate chromatin. A key question is how the RNAi and chromatin modification machineries are connected. Stc1 is a small protein recently shown to associate with both Ago1 and CLRC and to play a pivotal role in mediating the RNAi-dependent recruitment of CLRC to chromatin. To understand its mode of action, we have performed a detailed structural and functional analysis of the Stc1 protein. Our analyses reveal that the conserved N-terminal region of Stc1 represents an unusual tandem zinc finger domain, with similarities to common LIM domains but distinguished by a lack of preferred relative orientation of the two zinc fingers. We demonstrate that this tandem zinc finger domain is involved in binding Ago1, whereas the nonconserved C-terminal region mediates association with CLRC. These findings elucidate the molecular basis for the coupling of RNAi to chromatin modification in fission yeast.