The Male- specific lethal (MSL) complex up-regulates the single male X chromosome to achieve dosage compensation in Drosophila. We have proposed that MSL recognition of specific entry sites on the X is followed by local targeting of active genes marked by H3K36 trimethylation. Here we analyze the role of the MSL3 chromodomain in the second targeting step. Using ChIP-chip analysis, we find that MSL3 chromodomain mutants retain binding to chromatin entry sites, but show a clear disruption in the full pattern of MSL targeting in vivo, consistent with a loss of spreading. Furthermore, when compared to wild-type, chromodomain mutants lack preferential affinity for nucleosomes containing H3K36me3 in vitro. Our results support a model in which activating complexes, like their silencing counterparts, use the nucleosomal binding specificity of their respective chromodomains to spread from initiation sites to flanking chromatin.