Abstract Background DNA methylation ensures genome integrity and regulates gene expression in diverse eukaryotes. In Arabidopsis, methylation occurs in three sequence contexts: CG, CHG and CHH. The initial establishment of DNA methylation at all three sequence contexts occurs through a process known as RNA-directed DNA methylation (RdDM), in which small RNAs bound by Argonaute4 (AGO4) guide DNA methylation at homologous loci through the de novo methyltransferase DRM2. Once established, DNA methylation at each of the three sequence contexts is maintained through different mechanisms. Although some players involved in RdDM and maintenance methylation have been identified, the underlying molecular mechanisms are not fully understood. To aid the comprehensive identification of players in DNA methylation, we generated a transgenic reporter system that permits genetic and chemical genetic screens in Arabidopsis. Results A dual 35S promoter (d35S) driven luciferase (LUC) reporter was introduced into Arabidopsis and LUCL, a line with a low basal level of luciferase activity, was obtained. LUCL was found to be a multi-copy, single-insertion transgene that contains methylated cytosines in CG, CHG and CHH contexts, with the highest methylation in the CG context. Methylation was present throughout the promoter and LUC coding region. Treatment with an inhibitor of cytosine methylation de-repressed luciferase activity. A mutation in MET1, which encodes the CG maintenance methyltransferase, drastically reduced CG methylation and de-repressed LUC expression. Mutations in AGO4 and DRM2 also de-repressed LUC expression, albeit to a smaller extent than loss of MET1. Using LUCL as a reporter line, we performed a chemical screen for compounds that de-repress LUC expression, and identified a chemical, methotrexate, known to be involved in biogenesis of the methyl donor. Conclusion We developed a luciferase-based reporter system, LUCL, which reports both RdDM and CG maintenance methylation in Arabidopsis. The low basal level of LUCL expression provides an easy readout in genetic and chemical genetic screens that will dissect the mechanisms of RdDM and methylation maintenance.