Spt6 is a conserved factor, critically required for several transcription- and chromatin-related processes. We now show that Spt6 and its binding partner, Iws1, are required for heterochromatic silencing in Schizosaccharomyces pombe. Our studies demonstrate that Spt6 is required for silencing of all heterochromatic loci and that an spt6 mutant has an unusual combination of heterochromatic phenotypes compared to previously studied silencing mutants. Unexpectedly, we find normal nucleosome positioning over heterochromatin and normal levels of histone H3K9 dimethylation at the endogenous pericentric repeats. However, we also find greatly reduced levels of H3K9 trimethylation, elevated levels of H3K14 acetylation, reduced recruitment of several silencing factors, and defects in heterochromatin spreading. Our evidence suggests that Spt6 plays a role at both the transcriptional and posttranscriptional levels; in an spt6 mutant, RNA polymerase II (RNAPII) occupancy at the pericentric regions is only modestly increased, while production of small interfering RNAs (siRNAs) is lost. Taken together, our results suggest that Spt6 is required for multiple steps in heterochromatic silencing by controlling chromatin, transcriptional, and posttranscriptional processes.