Processes that regulate gene transcription are directly under the influence of the genome organization. The epigenome contains additional information that is not brought by DNA sequence, and generates spatial and functional constraints that complement genetic instructions. DNA methylation on CpGs constitutes an epigenetic mark generally correlated with transcriptionally silent condensed chromatin. Replication of methylation patterns by DNA methyltransferases maintains genome stability through cell division. Here we present evidence of an unanticipated dynamic role for DNA methylation in gene regulation in human cells. Periodic, strand-specific methylation/demethylation occurs during transcriptional cycling of the pS2/TFF1 gene promoter on activation by oestrogens. DNA methyltransferases exhibit dual actions during these cycles, being involved in CpG methylation and active demethylation of 5mCpGs through deamination. Inhibition of this process precludes demethylation of the pS2 gene promoter and its subsequent transcriptional activation. Cyclical changes in the methylation status of promoter CpGs may thus represent a critical event in transcriptional achievement.