Human histone demethylase LSD1 is a flavin-dependent amine oxidase that catalyzes the specific removal of methyl groups from mono- and dimethylated Lys4 of histone H3. The N-terminal tail of H3 is subject to various covalent modifications, and a fundamental question in LSD1 biology is how these epigenetic marks affect the demethylase activity. We show that LSD1 does not have a strong preference for mono- or dimethylated Lys4 of H3. Substrate recognition is not confined to the residues neighboring Lys4, but it requires a sufficiently long peptide segment consisting of the N-terminal 20 amino acids of H3. Electrostatic interactions are an important factor in protein-substrate recognition, as indicated by the high sensitivity of Km to ionic strength. We have probed LSD1 for its ability to demethylate Lys4 in presence of a second modification on the same peptide substrate. Methylation of Lys9 does not affect enzyme catalysis. Conversely, Lys9 acetylation causes an almost 6-fold increase in the Km value, whereas phosphorylation of Ser10 totally abolishes activity. LSD1 is inhibited by a demethylated peptide with an inhibition constant of 1.8 microM, suggesting that LSD1 can bind to H3 independently of Lys4 methylation. LSD1 is a chromatin-modifying enzyme, which is able to read different epigenetic marks on the histone N-terminal tail and can serve as a docking module for the stabilization of the associated corepressor complex(es) on chromatin.