Histone H3K9 methylation is required for DNA methylation and silencing of repetitive elements in plants and filamentous fungi. In mammalian cells however, deletion of the H3K9 histone methyltransferases (HMTases) Suv39h1 and Suv39h2 does not affect DNA methylation of the endogenous retrovirus murine leukaemia virus, indicating that H3K9 methylation is dispensable for DNA methylation of retrotransposons, or that a different HMTase is involved. We demonstrate that embryonic stem (ES) cells lacking the H3K9 HMTase G9a show a significant reduction in DNA methylation of retrotransposons, major satellite repeats and densely methylated CpG-rich promoters. Surprisingly, demethylated retrotransposons remain transcriptionally silent in G9a(-/-) cells, and show only a modest decrease in H3K9me2 and no decrease in H3K9me3 or HP1alpha binding, indicating that H3K9 methylation per se is not the relevant trigger for DNA methylation. Indeed, introduction of catalytically inactive G9a transgenes partially 'rescues' the DNA methylation defect observed in G9a(-/-) cells. Taken together, these observations reveal that H3K9me3 and HP1alpha recruitment to retrotransposons occurs independent of DNA methylation in ES cells and that G9a promotes DNA methylation independent of its HMTase activity.