We describe the purification and characterization of ACF, an ATP-utilizing chromatin assembly and remodeling factor. ACF is a multisubunit factor that contains ISWI protein and is distinct from NURF, another ISWI-containing factor. In chromatin assembly, purified ACF and a core histone chaperone (such as NAP-1 or CAF-1) are sufficient for the ATP-dependent formation of periodic nucleosome arrays. In chromatin remodeling, ACF is able to modulate the internucleosomal spacing of chromatin by an ATP-dependent mechanism. Moreover, ACF can mediate promoter-specific nucleosome reconfiguration by Gal4-VP16 in an ATP-dependent manner. These results suggest that ACF acts catalytically both in chromatin assembly and in the remodeling of nucleosomes that occurs during transcriptional activation.