Abstract: The spatial arrangement of chromatin within the nucleus can affect reactions that occur on the DNA and is likely to be regulated. Here we show that activation of INO1 occurs at the nuclear membrane and requires the integral membrane protein Scs2. Scs2 antagonizes the action of the transcriptional repressor Opi1 under conditions that induce the unfolded protein response (UPR) and, in turn, activate INO1. Whereas repressed INO1 localizes throughout the nucleoplasm, the gene is recruited to the nuclear periphery upon transcriptional activation. Recruitment requires the transcriptional activator Hac1, which is produced upon induction of the UPR, and is constitutive in a strain lacking Opi1. Artificial recruitment of INO1 to the nuclear membrane permits activation in the absence of Scs2, indicating that the intranuclear localization of a gene can profoundly influence its mechanism of activation. Gene recruitment to the nuclear periphery, therefore, is a dynamic process and appears to play an important regulatory role.