Binding of heterochromatin protein 1 (HP1) to the histone H3 lysine 9 trimethylation (H3K9me3) mark is a hallmark of establishment and maintenance of heterochromatin. Although genetic and cell biological aspects have been elucidated, the molecular details of HP1 binding to H3K9me3 nucleosomes are unknown. Using a combination of NMR spectroscopy and biophysical measurements on fully defined recombinant experimental systems, we demonstrate that H3K9me3 works as an on/off switch regulating distinct binding modes of hHP1β to the nucleosome. The methyl-mark determines a highly flexible and very dynamic interaction of the chromodomain of hHP1β with the H3-tail. There are no other constraints of interaction or additional multimerization interfaces. In contrast, in the absence of methylation, the hinge region and the N-terminal tail form weak nucleosome contacts mainly with DNA. In agreement with the high flexibility within the hHP1β-H3K9me3 nucleosome complex, the chromoshadow domain does not provide a direct binding interface. Our results report the first detailed structural analysis of a dynamic protein-nucleosome complex directed by a histone modification and provide a conceptual framework for understanding similar interactions in the context of chromatin.