It was described earlier that the Drosophila GAGA factor [Trithorax-like (Trl)] interacts with dSAP18, which, in mammals, was reported to be a component of the Sin3-HDAC co-repressor complex. GAGA-dSAP18 interaction was proposed to contribute to the functional regulation of the bithorax complex (BX-C). Here, we show that mutant alleles of Trl, dsap18 and drpd3/hdac1 enhance A6-to-A5 transformation indicating a contribution to the regulation of Abd-B expression at A6. In A6, expression of Abd-B is driven by the iab-6 enhancer, which is insulated from iab-7 by the Fab-7 element. Here, we report that GAGA, dSAP18 and dRPD3/HDAC1 co-localize to ectopic Fab-7 sites in polytene chromosomes and that mutant Trl, dsap18 and drpd3/hdac1 alleles affect Fab-7-dependent silencing. Consistent with these findings, chromatin immunoprecipitation analysis shows that, in Drosophila embryos, the endogenous Fab-7 element is hypoacetylated at histones H3 and H4. These results indicate a contribution of GAGA, dSAP18 and dRPD3/HDAC1 to the regulation of Fab-7 function.