DNA methylation plays an important role in the gene-silencing network of higher eukaryotes. We have analyzed the 21.5-kb maintenance methyltransferase (M-MTase) gene, met1, of the multicellular green alga Volvox carteri. The met1 transcript was detected only during the period when DNA replication and cell division are taking place. It encodes a 238 kDa protein containing eight C-terminal activity domains typical of M-MTases, plus upstream DNA-binding domains including the ProDom domain PD003757, which experimental analyses in animal systems have indicated is required for targeting the enzyme to DNA-replication foci. Several insertions of unknown function make Volvox Met1 the largest known member of the Met1/Dnmt1 family. Here we also show that several endogenous transposon families are CpG-methylated in Volvox, which we think causes them to be inactive. This view is supported by the observation that an in vitro CpG-methylated gene introduced into Volvox was maintained in the methylated and silent state over >100 generations. Thus, we believe that Met1 recognizes and perpetuates the in vitro methylation signal, and that the silencing machinery is then able to transduce such a methylation-only signal into a stable heterochromatic (and silent) state.