The molecular motor protein CHD1 has been implicated in the regulation of transcription and in the transcription-independent genome-wide incorporation of H3.3 into paternal chromatin in Drosophila melanogaster. A key feature of CHD1 is the presence of two chromodomains, which can bind to histone H3 methylated at lysine 4 and thus might serve to recruit and/or maintain CHD1 at the chromatin. Here, we describe genetic and biochemical approaches to the study of the Drosophila CHD1 chromodomains. We found that overall localization of CHD1 on polytene chromosomes does not appreciably change in chromodomain-mutant flies. In contrast, the chromodomains are important for transcription-independent activities of CHD1 during early embryonic development as well as for transcriptional regulation of several heat shock genes. However, neither CHD1 nor its chromodomains are needed for RNA polymerase II localization and H3K4 methylation but loss of CHD1 decreases transcription-induced histone eviction at the Hsp70 gene in vivo. Chromodomain mutations negatively affect the chromatin assembly activities of CHD1 in vitro, and they appear to be involved in linking the ATP-dependent motor to the chromatin assembly function of CHD1.