Abstract
DNA modifications are used to regulate gene expression and defend against invading genetic elements. In eukaryotes, modifications predominantly involve C5-methylcytosine (5mC) and occasionally N6-methyladenine (6mA), while bacteria frequently use N4-methylcytosine (4mC) in addition to 5mC and 6mA. Here we report that 4mC can serve as an epigenetic mark in eukaryotes. Bdelloid rotifers, tiny freshwater invertebrates with transposon-poor genomes rich in foreign genes, lack canonical eukaryotic C5-methyltransferases for 5mC addition, but encode an amino-methyltransferase, N4CMT, captured from bacteria >60 Mya. N4CMT deposits 4mC at active transposons and certain tandem repeats, and fusion to a chromodomain shapes its "histone-read-DNA-write" architecture recognizing silent chromatin marks. Furthermore, amplification of SETDB1 H3K9me3 histone methyltransferases yields variants preferentially binding 4mC-DNA, suggesting "DNA-read-histone-write" partnership to maintain chromatin-based silencing. Our results show how non-native DNA methyl groups can reshape epigenetic systems to silence transposons and demonstrate the potential of horizontal gene transfer to drive regulatory innovation in eukaryotes.