The rRNA gene cluster consists of multiple transcription units. Half of these are active, while the other half are transcriptionally inactive. Previously, in vivo studies have demonstrated that silencing of ribosomal DNA (rDNA) is mediated by the chromatin remodeling NoRC (nucleolar remodeling complex). To explore the mechanisms underlying NoRC-directed silencing of rDNA transcription, we investigated the effect of recombinant NoRC on RNA polymerase I transcription on reconstituted chromatin templates. We show that NoRC interacts with the transcription terminator factor (TTF-I), and this interaction is required both for the binding of TTF-I to its promoter-proximal target site and for the recruitment of NoRC to the promoter. After association with the rDNA promoter, NoRC alters the position of the promoter-bound nucleosome, thereby repressing RNA polymerase I transcription. This NoRC-directed rDNA repression requires the N terminus of histone H4. Repression is effective before preinitiation complex formation and as such is unable to exert an effect upon activated rDNA genes. Furthermore, the early steps of rDNA repression do not depend on DNA and histone modifications. These results reveal an important role for TTF-I in recruiting NoRC to rDNA and an active role for NoRC in the establishment of rDNA silencing.