Epigenetics refers to heritable patterns of gene expression that do not depend on alterations of the genomic DNA sequence. Nickel compounds have demonstrated carcinogenicity without any associated mutagenesis, suggesting that its mechanism of carcinogenesis is epigenetic in nature. One such potential mechanism is the heterochromatinization of chromatin within a region of the genome containing a gene sequence, inhibiting any further molecular interactions with that underlying gene sequence and effectively inactivating that gene. We report here the observation, by atomic force microscopy and circular dichroism spectropolarimetry, that nickel ion (Ni(2+)) condenses chromatin to a greater extent than the natural divalent cation of the cell, magnesium ion (Mg(2+)). In addition, we use a model experimental system that incorporates a transgene, the bacterial xanthine guanine phosphoribosyl transferase gene (gpt), differentially near, and far from, a heterochromatic region of the genome, in two cell lines, the Chinese hamster V79-derived G12 and G10 cells, respectively, to demonstrate by a DNase I protection assay that nickel treatement protects the gpt gene sequence from DNase I exonuclease digestion in the G12 cells, but not in the G10 cells. We conclude that condensation of chromatin by nickel is a potential mechanism of nickel-mediated gene regulation.