The factors that sequester transcriptionally repressed heterochromatin at the nuclear periphery are currently unknown. In a genome-wide RNAi screen, we found that depletion of S-adenosylmethionine (SAM) synthetase reduces histone methylation globally and causes derepression and release of heterochromatin from the nuclear periphery in Caenorhabditis elegans embryos. Analysis of histone methyltransferases (HMTs) showed that elimination of two HMTs, MET-2 and SET-25, mimics the loss of SAM synthetase, abrogating the perinuclear attachment of heterochromatic transgenes and of native chromosomal arms rich in histone H3 lysine 9 methylation. The two HMTs target H3K9 in a consecutive fashion: MET-2, a SETDB1 homolog, mediates mono- and dimethylation, and SET-25, a previously uncharacterized HMT, deposits H3K9me3. SET-25 colocalizes with its own product in perinuclear foci, in a manner dependent on H3K9me3, but not on its catalytic domain. This colocalization suggests an autonomous, self-reinforcing mechanism for the establishment and propagation of repeat-rich heterochromatin.