Structural component of heterochromatin, involved in gene repression and the modification of position-effect-variegation. Recognizes and binds histone H3 tails methylated at 'Lys-9', leading to epigenetic repression. Homodimer; probably associates with Su(var)3-9. Interacts with Mcm10. Interacts (via chromoshadow domain) with piwi (via N-terminal region). Colocalizes with Arp6 on centric heterochromatin.