Nuclear envelope-peripheral heterochromatin fractions contain multiple histone kinase activities. In vitro assays and amino-terminal sequencing show that one of these activities co-isolates with heterochromatin protein 1 (HP1) and phosphorylates histone H3 at threonine 3. Antibodies recognizing this post-translational modification reveal that in vivo phosphorylation at threonine 3 commences at early prophase in the vicinity of the nuclear envelope, spreads to pericentromeric chromatin during prometaphase and is fully reversed by late anaphase. This spatio-temporal pattern is distinct from H3 phosphorylation at serine 10, which also occurs during cell division, suggesting segregation of differentially phosphorylated chromatin to different regions of mitotic chromosomes.