Extensive DNA rearrangements occur during the differentiation of the developing somatic macronuclear genome from the germ line micronuclear genome of Tetrahymena thermophila. To identify genes encoding proteins likely to be involved in this process, we devised a cytological screen to find proteins that specifically localize in macronuclear anlagen (Lia proteins) at the stage when rearrangements occur. We compared the localization of these with that of the chromodomain protein, Pdd1p, which is the most abundant known participant in this genome reorganization. We show that in live cells, Pdd1p exhibits dynamic localization, apparently shuttling from the parental to the developing nuclei through cytoplasmic bodies called conjusomes. Visualization of GFP-tagged Pdd1p also highlights the substantial three-dimensional nuclear reorganization in the formation of nuclear foci that occur coincident with DNA rearrangements. We found that late in macronuclear differentiation, four of the newly identified proteins are organized into nuclear foci that also contain Pdd1p. These Lia proteins are encoded by primarily novel genes expressed at the beginning of macronuclear differentiation and have properties or recognizable domains that implicate them in chromatin or nucleic acid binding. Three of the Lia proteins also localize to conjusomes, a result that further implicates this structure in the regulation of DNA rearrangement.