Heterochromatin assembly, involving methylation of histone H3 lysine 9 (H3K9me), regulates various chromosomal processes. In fission yeast, heterochromatin targeted to specific repeat loci in an RNAi-dependent manner spreads across extended domains to exert regional epigenetic control. The Clr4 methyltransferase complex (ClrC) is responsible for nucleation and spreading of heterochromatin; however, its recruitment to heterochromatic repeats is poorly understood. Here we demonstrate that ClrC components are distributed throughout heterochromatic domains. To nucleate heterochromatin, Rik1, a WD domain-containing subunit of ClrC, is loaded onto the transcribed repeats via RNAi machinery including the RNA-induced transcriptional silencing (RITS) complex. Furthermore, we show that the chromodomain of Clr4 binds specifically to H3K9me that is essential for the spreading of heterochromatin. Our analyses delineate sequential steps for the assembly of heterochromatic domains and suggest that the ability of Clr4 to both 'write' and 'read' H3K9me facilitates heterochromatin maintenance through successive cell divisions.