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High-fidelity chromosome segregation during mitosis requires kinetochores, protein complexes that assemble on centromeric DNA and mediate chromosome attachment to spindle microtubules. In budding yeast, phosphoinositide-specific phospholipase C (Plc1p encoded by PLC1 gene) is important for function of kinetochores. Deletion of PLC1 results in alterations in chromatin structure of centromeres, reduced binding of microtubules to minichromosomes, and a higher frequency of chromosome loss. The mechanism of Plc1p's involvement in kinetochore activity was not initially obvious; however, a testable hypothesis emerged with the discovery of the role of inositol polyphosphates (InsPs), produced by a Plc1p-dependent pathway, in the regulation of chromatin-remodeling complexes. In addition, the remodels structure of chromatin (RSC) chromatin-remodeling complex was found to associate with kinetochores and to affect centromeric chromatin structure. We report here that Plc1p and InsPs are required for recruitment of the RSC complex to kinetochores, which is important for establishing proper chromatin structure of centromeres and centromere proximal regions. Mutations in PLC1 and components of the RSC complex exhibit strong genetic interactions and display synthetic growth defect, altered nuclear morphology, and higher frequency of minichromosome loss. The results thus provide a mechanistic explanation for the previously elusive role of Plc1p and InsPs in kinetochore function.