The MCM (mini-chromosome maintenance) genes have a well established role in the initiation of DNA replication and in the elongation of replication forks in Saccharomyces cerevisiae. In this study we demonstrate elevated expression of sub-telomeric and Ty retrotransposon-proximal genes in two mcm5 strains. This pattern of up-regulated genes resembles the genome-wide association of MCM proteins to chromatin that was reported earlier. We link the altered gene expression in mcm5 strains to a reversal of telomere position effect (TPE) and to remodeling of sub-telomeric and Ty chromatin. We also show a suppression of the Ts phenotype of a mcm5 strain by the high copy expression of the TRA1 component of the chromatin-remodeling SAGA/ADA (SPT-ADA-GCN5 acetylase/ADAptor). We propose that MCM proteins mediate the establishment of silent chromatin domains around telomeres and Ty retrotransposons.