In vivo competition between histones H1 and H5 for chromatin has been studied in rat sarcoma XC10 cells transfected with a glucocorticoid responsive MMTV-H5 gene. Activation of H5 expression results in accumulation of H5 in the nuclei where it partially replaces H1. H5 displaces H1 from its primary binding sites presumably during chromatin replication and also binds with high affinity to secondary chromatin sites normally not occupied by H1. Replacement of H1 by H5 to levels similar to those of mature chicken erythrocytes does not alter the nucleosome repeat length of chromatin. This indicates that H5 is not solely responsible for the increase in nucleosome spacing of maturing erythroid cells. Exchange of H1 by H5 in vivo or in vitro results in a higher compaction/stability of chromatin.