The studies described here have focused on elucidating how Sir-mediated silent chromatin regulates gene transcription and what determinants may affect the linear diffusion of Sir complex along chromatin template in the yeast Saccharomyces cerevisiae. The studies pinpoint the transition between polymerase initiation and elongation as the step targeted by Sir2, and indicate that transcriptional silencing is achieved through the differential accessibility of initiation and capping/elongation factors to chromatin. The mechanisms by which SIR modulates gene activation are also explored with analysis at HMRE- silenced heat shock gene hsp82. Such investigations revealed that transcriptional activation of SIR- silenced hsp82 is independent of its associated chromatin state. Surprisingly, the presence of Sir proteins and Htz1 is not mutually exclusive and Htz1 alone is not sufficient to prevent Sir2/3/4 complex spread. These findings cast doubt on the generality of the “histone code” in regulating eukaryotic gene transcription.