Eukaryotic DNA is packaged into chromatin by histone proteins, which assemble the DNA into an organized, higher-order structure. The precise organization of chromatin is essential for faithful execution of DNA-mediated reactions such as transcription, DNA replication, DNA repair and DNA recombination. The organization of chromatin is considered to be regulated by a variety of post-translational modifications of histones, such as acetylation, methylation, phosphorylation, ubiquitination, SUMOylation and poly-ADP-ribosylation. The relationship between histone acetylation and gene expression was first observed in 1964. Since then, a great deal of evidence has accumulated showing that not only transcription but other DNA-mediated reactions also are regulated by histone acetylation. With regard to the putative mechanism(s) by which histone acetylation regulates the flow of genetic information, site-specific modification and recognition of acetylated histone/DNA complexes have been postulated. Elucidation of the downstream effects of histone modification, as well as the identification, isolation and characterization of the relevant factors involved, have aided in our understanding of the mechanisms of regulation of DNA activity by histones. Currently, state-of-the-art technologies that enable genome-wide analysis are allowing insight into a critical and interesting question in eukaryotic transcription: are the principles that govern transcription of individual gene loci applicable to the genome as a whole? Here, we review the recent progress on histone modifications, with an emphasis on the role of histone acetylation in gene expression.