Deacetylases of the Sir2 or sirtuin family are thought to regulate life cycle progression and life span in response to nutrient availability. This family has undergone successive rounds of duplication and diversification, enabling the enzymes to perform a wide variety of biological functions. Two evolutionarily conserved functions of yeast Sir2 proteins are the generation of repressive chromatin in subtelomeric domains and the suppression of unbalanced recombination within the tandem rDNA array. Here, we describe the function of the Sir2 ortholog ClHst1 in the yeast Clavispora lusitaniae, an occasional opportunistic pathogen. ClHst1 was localized to the non-transcribed spacer regions of the rDNA repeats and deacetylated histones at these loci, indicating that, like other Sir2 proteins, ClHst1 modulates chromatin structure at the rDNA repeats. However, we found no evidence that ClHst1 associates with subtelomeric regions or impacts gene expression directly. This surprising observation highlights the plasticity of sirtuin function. Related yeast species, including Candida albicans, possess an additional Sir2 family member. Thus, it is likely that the ancestral Candida SIR2/HST1 gene was duplicated and subfunctionalized, such that HST1 retained the capacity to regulate rDNA whereas SIR2 had other functions, perhaps including the generation of subtelomeric chromatin. After subsequent species diversification, the SIR2 paralog was apparently lost in the C. lusitaniae lineage. Thus, C. lusitaniae presents an opportunity to discover how subtelomeric chromatin can be reconfigured.