"Chromatin modifying enzymes play important roles in the regulation of gene expression, the establishment and maintenance of distinct cell types during development and the control of cellular proliferation. All of these features make them interesting targets for small molecule inhibitors that can function as probes for basic biological questions but also as lead compounds for drug development. Indeed the first compounds inhibiting histone deacetylases and DNA methyltransferases have been approved for treatment of proliferative disorders. For other equally important classes of chromatin modifying enzymes, in particular histone methyltransferases (HMTases) and histone demethylases (HDMs), currently only few or no small molecule antagonists are available. Here we propose to identify and generate such compounds and test them together with RNAi libraries for their ability to control cell fate decisions and proliferation in two important medical areas, diabetes and cancer. In diabetes therapy, reestablishment of pancreatic beta cell mass is an important clinical goal. We will address the contribution of chromatin modifying enzymes to beta cell proliferation and trans(differentiation) into beta cells, and then use this knowledge to generate and improve small molecules targeting these pathways. While inducers of proliferation are desirable for beta cell expansion, proliferation control is essential for treatment of cancer. Different chromatin modifying enzymes have been implicated as tumor suppressor genes and oncogenes, making compounds targeting these enzymes promising for cancer therapy. We will identify inhibitors of proliferation in several cancer cell lines that show increased expression of chromatin modifying enzymes. Furthermore, the genetic and epigenetic contributions to cancer development and the synergism between signaling and chromatin modification pathways will be addressed in leukemia cells overexpressing Bcr-Abl."