Histone methylation plays important roles in the regulation of chromatin dynamics and transcription. Steady-state levels of histone lysine methylation are regulated by a balance between enzymes that catalyze either the addition or removal of methyl groups. Using an activity-based biochemical approach, we recently uncovered the JmjC domain as an evolutionarily conserved signature motif for histone demethylases. Furthermore, we demonstrated that Jhd1, a JmjC domain-containing protein in Saccharomyces cerevisiae, is an H3K36-specific demethylase. Here we report further characterization of Jhd1. Similar to its mammalian homolog, Jhd1-catalyzed histone demethylation requires iron and alpha-ketoglutarate as cofactors. Mutation and deletion studies indicate that the JmjC domain and adjacent sequences are critical for Jhd1 enzymatic activity, while the N-terminal PHD domain is dispensable. Overexpression of JHD1 results in a global reduction of H3K36 methylation in vivo. Finally, chromatin immunoprecipitation-coupled microarray studies reveal subtle changes in the distribution of H3K36me2 upon overexpression or deletion of JHD1. Our studies establish Jhd1 as a histone demethylase in budding yeast and suggest that Jhd1 functions to maintain the fidelity of histone methylation patterns along transcription units.