Determining the effect of DNA methylation on chromatin structure and function in higher organisms is challenging due to the extreme complexity of epigenetic regulation. We studied a simpler model system, budding yeast, that lacks DNA methylation machinery making it a perfect model system to study the intrinsic role of DNA methylation in chromatin structure and function. We expressed the murine DNA methyltransferases in Saccharomyces cerevisiae and analyzed the correlation between DNA methylation, nucleosome positioning, gene expression and 3D genome organization. Despite lacking the machinery for positioning and reading methylation marks, induced DNA methylation follows a conserved pattern with low methylation levels at the 5' end of the gene increasing gradually toward the 3' end, with concentration of methylated DNA in linkers and nucleosome free regions, and with actively expressed genes showing low and high levels of methylation at transcription start and terminating sites respectively, mimicking the patterns seen in mammals. We also see that DNA methylation increases chromatin condensation in peri-centromeric regions, decreases overall DNA flexibility, and favors the heterochromatin state. Taken together, these results demonstrate that methylation intrinsically modulates chromatin structure and function even in the absence of cellular machinery evolved to recognize and process the methylation signal.