SUUR (Suppressor of Under-Replication) protein is responsible for late replication and, as a consequence, for DNA underreplication of intercalary and pericentric heterochromatin in Drosophila melanogaster polytene chromosomes. However, the mechanism by which SUUR slows down the replication process is not clear. To identify possible partners for SUUR we performed a yeast two-hybrid screen using full-length SUUR as bait. This identified HP1, the well-studied heterochromatin protein, as a strong SUUR interactor. Furthermore, we have determined that the central region of SUUR is necessary and sufficient for interaction with the C-terminal part of HP1, which contains the hinge and chromoshadow domains. In addition, recruitment of SUUR to ectopic HP1 sites on chromosomes provides evidence for their association in vivo. Indeed, we found that the distributions of SUUR and HP1 on polytene chromosomes are interdependent: both absence and overexpression of HP1 prevent SUUR from chromosomal binding, whereas SUUR overexpression causes redistribution of HP1 to numerous sites occupied by SUUR. Finally, HP1 binds to intercalary heterochromatin when histone methyltransferase activity of SU(VAR)3-9 is increased. We propose that interaction with HP1 is crucial for the association of SUUR with chromatin.