Heterochromatin is a critical chromatin compartment, whose integrity governs genome stability and cell fate transitions. How heterochromatin features, including higher-order chromatin folding and histone modifications associated with transcriptional silencing, are maintained following a genotoxic stress challenge is unknown. Here, we establish a system for targeting UV damage to pericentric heterochromatin in mammalian cells and for tracking the heterochromatin response to UV in real time. We uncover profound heterochromatin compaction changes during repair, orchestrated by the UV damage sensor DDB2, which stimulates linker histone displacement from chromatin. Despite massive heterochromatin unfolding, heterochromatin-specific histone modifications and transcriptional silencing are maintained. We unveil a central role for the methyltransferase SETDB1 in the maintenance of heterochromatic histone marks after UV. SETDB1 coordinates histone methylation with new histone deposition in damaged heterochromatin, thus protecting cells from genome instability. Our data shed light on fundamental molecular mechanisms safeguarding higher-order chromatin integrity following DNA damage.