Sister chromatid cohesion is essential for accurate chromosome segregation during the cell cycle. Newly identified structural proteins are required for sister chromatid cohesion and there may be a link in some organisms between the processes of cohesion and condensation. Proteins that induce and regulate the separation of sister chromatids have also been recently identified. (This review is an updated version of one that was published in Current Opinion in Cell Biology 1998, 10:769-775.)