In Saccharomyces cerevisiae, methylation of histone H3 at active genes is an epigenetic mark that distinguishes active from silent chromatin and functions as a short-term "memory" of recent transcription. Methylation of H3 at lysine residues K4 and K79 depends on ubiquitylation of histone H2B, but the mechanisms linking H2B ubiquitylation to H3 methylation are unknown. Here, we demonstrate that proteasomal ATPases Rpt4 and Rpt6 function to connect these two histone modifications. We show that recruitment of proteasome subunits to chromatin depends on H2B ubiquitylation and that mutations in Rpt4 and Rpt6 disrupt H3 methylation at K4 and K79 but leave H2B ubiquitylation intact. Consistent with their role in H3 methylation, we also find that mutations in Rpt4 and 6-but not components of the 20S proteasome-disrupt telomeric gene silencing. These data reveal that proteasome subunits function in epigenetic gene regulation by linking chromatin modifications that establish the histone code.