Nuclear receptors (NRs) are ligand-inducible transcription factors that mediate complex effects on development, differentiation and homeostasis. They regulate the transcription of their target genes through binding to cognate DNA sequences as homodimers or heterodimers. The molecular mechanisms underlying transcriptional activation by NRs are still poorly understood, although intermediary factors (mediators) appear to be involved in mediating the transactivation functions of NRs. TIF1 has been identified previously as a protein that interacts specifically with the ligand binding domain of several nuclear receptors, both in yeast and in vitro. The characteristics of these interactions have led us to suggest that TIF1 might be a mediator of the NR ligand-inducible activation function AF-2. Using a two-hybrid screening in yeast, we have now identified two TIF1-binding proteins, mHP1 alpha and mMOD1, that are mouse homologues of the Drosophila heterochromatinic protein 1. Using mHP1 alpha as a bait in a second two-hybrid screening, we have isolated cDNAs encoding proteins that are also very likely to be involved in chromatin structure and function, as well as a protein structurally and functionally related to TIF1 (renamed TIF1 alpha), which was named TIF1 beta. Here we discuss how the function of members of the TIF1 family in the control of transcription could be exerted at the level of the structure of the chromatin template.