Development of methods that will allow exogenous imposition of inheritable gene-specific methylation patterns has potential application in both therapeutics and in basic research. An ongoing approach is the use of targeted DNA methyltransferases, which consist of a fusion between gene-targeted zinc-finger proteins and prokaryotic DNA cytosine methyltransferases. These enzymes however have so far demonstrated significant and unacceptable levels of non-targeted methylation. We now report the development of second-generation targeted methyltransferase enzymes comprising enhanced zinc-finger arrays coupled to methyltransferase mutants that are functionally dominated by their zinc-finger component. Both in vitro plasmid methylation studies and a novel bacterial assay reveal a high degree of target-specific methylation by these enzymes. Furthermore, we demonstrate for the first time transient expression of targeted cytosine methyltransferase in mammalian cells resulting in the specific methylation of a chromosomal locus. Importantly, the resultant methylation pattern is inherited through successive cell divisions.