The three-dimensional (3D) organization of the genome is clearly linked to genome function as it varies during the cell cycle and upon differentiation in metazoans. However, the cause/consequence relationship between nuclear organization and function remains elusive. Budding yeast has proven to be an excellent model for testing the functional role of higher-order chromatin organization. Studies over the last two decades have revealed a dynamic yet well-defined organization of the yeast genome. This organization impacts gene expression and genome stability through poorly understood mechanisms. Using this model system, we ask two main questions: i, What determines the spatial and temporal behavior of chromatin? ii, How does nuclear organization affect two essential functions of the genome: gene expression and the maintenance of genome integrity? A striking aspect of nuclear organization is the existence of subnuclear compartments, enriched with specific genomic regions, RNAs and proteins. These are thought to create microenvironments that favor or impede a particular DNA- or RNA-based activity. To understand how nuclear organization participates in nuclear function, we must decipher how such microenvironments form in the absence of physical barrier, and what regulates their dynamics in relation to changes in genome activity. We combine genetics and advanced microscopy approaches – including single molecule microscopy – to dissect the molecular and physical mechanisms underlying the formation and dynamics of subnuclear compartments, particularly in response to changes in environmental conditions or upon genotoxic stress. To gain insight into the physical mechanisms underlying this organization, we integrate our experimental data into quantitative models, generating hypotheses that are then tested experimentally. We focus on two types of conserved subnuclear compartments: i, the clustering of silent chromatin, in which the clustering of repetitive DNA sequesters general repressors of transcription; ii, repair foci that concentrate DNA repair proteins at sites of damage, with a particular interest in homologous recombination. Combining cell biology, genetics and -omics approaches, we investigate the interplay between the 3D folding of the genome, RNA expression (coding and non-coding) and genome stability during major metabolic transitions, prolonged quiescence or genotoxic stress. To directly test the impact of 3D genome organization on genomic functions, we develop tools to modify this organization and test the functional consequences of these perturbations.