Exceptions to Mendelian inheritance often highlight novel chromosomal behaviors. The maize Pl1-Rhoades allele conferring plant pigmentation can display inheritance patterns deviating from Mendelian expectations in a behavior known as paramutation. However, the chromosome features mediating such exceptions remain unknown. Here we show that small RNA production reflecting RNA polymerase IV function within a distal downstream set of five tandem repeats is coincident with meiotically-heritable repression of the Pl1-Rhoades transcription unit. A related pl1 haplotype with three, but not one with two, repeat units also displays the trans-homolog silencing typifying paramutations. 4C interactions, CHD3a-dependent small RNA profiles, nuclease sensitivity, and polyadenylated RNA levels highlight a repeat subregion having regulatory potential. Our comparative and mutant analyses show that transcriptional repression of Pl1-Rhoades correlates with 24-nucleotide RNA production and cytosine methylation at this subregion indicating the action of a specific DNA-dependent RNA polymerase complex. These findings support a working model in which pl1 paramutation depends on trans-chromosomal RNA-directed DNA methylation operating at a discrete cis-linked and copy-number-dependent transcriptional regulatory element.