Histone N-terminal tails play crucial roles in chromatin-related processes. The tails of histones H3 and H4 are highly conserved and well characterized, but much less is known about the functions of the tails of histones H2A and H2B and their sequences are more divergent among eukaryotes. Here we characterized the function of the only highly conserved region in the H2B tail, the H2B repression (HBR) domain. Once thought to play a role only in repression, it also has an uncharacterized function in gene activation and DNA damage responses. We report that deletion of the HBR domain impairs the eviction of nucleosomes at the promoters and open reading frames of genes. A closer examination of the HBR domain mutants revealed that they displayed phenotypes similar to those of histone chaperone complex FACT mutants, including an increase in intragenic transcription and the accumulation of free histones in cells. Biochemical characterization of recombinant nucleosomes indicates that deletion of the HBR domain impairs FACT-dependent removal of H2A-H2B from nucleosomes, suggesting that the HBR domain plays an important role in allowing FACT to disrupt dimer-DNA interactions. We have uncovered a previously unappreciated role for the HBR domain in regulating chromatin structure and have provided insight into how FACT acts on nucleosomes.