The Heterochromatin Protein 1 (HP1) is a conserved protein which is best known for its strong association with the heterochromatin of Drosophila melanogaster. We previously demonstrated that another important property of HP1 is its localization to the telomeres of Drosophila, a feature that reflects its critical function as a telomere capping protein. Here we report our analysis of the euchromatic sites to which HP1 localizes. Using an anti-HP1 antibody, we compared immunostaining patterns on polytene chromosomes of the Ore-R wild type laboratory strain and four different natural populations. HP1 was found to accumulate at specific euchromatic sites, with a subset of the sites conserved among strains. These sites do not appear to be defined by an enrichment of known repetitive DNAs. Comparisons of HP1 patterns among several Drosophila species revealed that association with specific euchromatic regions, heterochromatin and telomeres is a conserved characteristic of HP1. Based on these results, we argue that HP1 serves a broader function than typically postulated. In addition to its role in heterochromatin assembly and telomere stability, we propose that HP1 plays an important role in regulating the expression of many different euchromatic regions.