Nucleosome turnover concomitant with incorporation of the replication-independent histone variant H3.3 is a hallmark of regulatory regions in the animal genome. Nucleosome turnover is known to be universally linked to DNA accessibility and histone acetylation. In mouse embryonic stem cells, H3.3 is also highly enriched at interstitial heterochromatin, most prominently at intracisternal A-particle endogenous retroviral elements. Interstitial heterochromatin is established over confined domains by the TRIM28-KAP1/SETDB1 corepressor complex and has stereotypical features of repressive chromatin, such as H3K9me3 and recruitment of all HP1 isoforms. Here, we demonstrate that fast histone turnover and H3.3 incorporation is compatible with these hallmarks of heterochromatin. Further, we find that Smarcad1 chromatin remodeler evicts nucleosomes generating accessible DNA. Free DNA is repackaged via DAXX-mediated nucleosome assembly with histone variant H3.3 in this dynamic heterochromatin state. Loss of H3.3 in mouse embryonic stem cells elicits a highly specific opening of interstitial heterochromatin with minimal effects on other silent or active regions of the genome.