The balance between cell differentiation and proliferation is regulated at the transcriptional level. In the cell cycle, the transition from G1 to S phase (G1/S transition) is of paramount importance in this regard. Indeed, it is only before this point that cells can be oriented toward the differentiation pathway: beyond, cells progress into the cycle in an autonomous manner. The G1/S transition is orchestrated by the transcription factor E2F. E2F controls the expression of a group of checkpoint genes whose products are required either for the G1-to-S transition itself or for DNA replication (e.g. DNA polymerase alpha). E2F activity is repressed in growth-arrested cells and in early G1, and is activated at mid-to-late G1. E2F is controlled by the retinoblastoma tumor suppressor protein Rb. Rb represses E2F mainly by recruiting chromatin remodeling factors (histone deacetylases and SWI/SNF complexes), the DNA methyltransferase DNMT1, and a histone methyltransferase. This review will focus on the molecular mechanisms of E2F repression by Rb during the cell cycle and during cell-cycle exit by differentiating cells. A model in which Rb irreversibly represses E2F-regulated genes in differentiated cells by an epigenetic mechanism linked to heterochromatin, and involving histone H3 and promoter DNA methylation, is discussed.