Heterochromatin is a tightly packed form of DNA involved in gene silencing, chromosome segregation, and protection of genome stability. Heterochromatin is becoming more recognized in tumor suppression and may thus serve as a potential target for cancer therapy. However, to date there are no drugs that are well established to specifically promote heterochromatin formation. Here, we describe a screening method using Drosophila to identify small molecule compounds that promote heterochromatin formation, with the purpose of developing epigenetic cancer therapeutics. We took advantage of a Drosophila strain with a variegated eye color phenotype that is sensitive to heterochromatin levels, and screened a library of 97 FDA approved oncology drugs. This screen identified methotrexate as the most potent small molecule drug, among the 97 oncology drugs screened, in promoting heterochromatin formation. Interestingly, methotrexate has been identified as a JAK/STAT inhibitor in a functional screen, causing reduced phosphorylation of STAT proteins. These findings are in line with our previous observation that unphosphorylated STAT (uSTAT) promotes heterochromatin formation in both Drosophila and human cells and suppresses tumor growth in mouse xenografts. Thus, Drosophila with variegated eye color phenotypes could be an effective tool for screening heterochromatin-promoting compounds that could be candidates as cancer therapeutics.