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Higher-order chromatin structure and DNA methylation are implicated in multiple developmental processes, but their relationship to cell state is unknown. Here, we find that large (>7.3 kb) DNA methylation nadirs (termed "grand canyons") can form long loops connecting anchor loci that may be dozens of megabases (Mb) apart, as well as inter-chromosomal links. The interacting loci cover a total of ∼3.5 Mb of the human genome. The strongest interactions are associated with repressive marks made by the Polycomb complex and are diminished upon EZH2 inhibitor treatment. The data are suggestive of the formation of these loops by interactions between repressive elements in the loci, forming a genomic subcompartment, rather than by cohesion/CTCF-mediated extrusion. Interestingly, unlike previously characterized subcompartments, these interactions are present only in particular cell types, such as stem and …