Methylation of cytosine in DNA plays a crucial role in development through inheritable gene silencing. The DNA methyltransferase Dnmt1 is responsible for the propagation of methylation patterns to the next generation via its preferential methylation of hemimethylated CpG sites in the genome; however, how Dnmt1 maintains methylation patterns is not fully understood. Here we report the crystal structure of the large fragment (291-1620) of mouse Dnmt1 and its complexes with cofactor S-adenosyl-L-methionine and its product S-adenosyl-L-homocystein. Notably, in the absence of DNA, the N-terminal domain responsible for targeting Dnmt1 to replication foci is inserted into the DNA-binding pocket, indicating that this domain must be removed for methylation to occur. Upon binding of S-adenosyl-L-methionine, the catalytic cysteine residue undergoes a conformation transition to a catalytically competent position. For the recognition of hemimethylated DNA, Dnmt1 is expected to utilize a target recognition domain that overhangs the putative DNA-binding pocket. Taking into considerations the recent report of a shorter fragment structure of Dnmt1 that the CXXC motif positions itself in the catalytic pocket and prevents aberrant de novo methylation, we propose that maintenance methylation is a multistep process accompanied by structural changes.