The acute promyelocytic leukemia (PML)-retinoic acid receptor alpha (RARalpha) fusion product recruits histone deacetylase (HDAC) and DNA methyltransferase (DNMT) activities on retinoic acid (RA)-target promoters causing their silencing and differentiation block. RA treatment induces epigenetic modifications at its target loci and restores myeloid differentiation of APL blasts. Using RA-sensitive and RA-resistant APL cell lines and primary blasts, we addressed the functional relevance of the aberrant methylation status at the RA-target promoter RARbeta2 and the mechanism by which methylation is reversed by RA. RA decreased DNMT expression and activity, which correlated with demethylation at specific sites on RARbeta2 promoter/exon-1, and the ability of APL blasts to differentiate in vitro and in vivo. None of these events occurred in an RA-resistant APL cell line containing a PML-RARalpha defective for ligand binding. The specific contribution of the HDAC and DNMT pathways to the response of APL cells to RA was also tested by inhibiting these enzymatic activities with TSA and/or 5-azacytidine. In RA-responsive and RA-resistant APL blasts, TSA and 5-azacytidine induced specific changes on the chromatin state at RA-target sites, increased the RA effect on promoter activity, endogenous RA-target gene expression and differentiation. These results extend the rationale for chromatin-targeted treatment in APL and RA-resistant leukemias.