Heterochromatin formation has been proposed to involve phase transitions on the level of the three-dimensional folding of heterochromatin regions and the liquid–liquid demixing of heterochromatin proteins. Here, I outline the hallmarks of such transitions and the current challenges to detect them in living cells. I further discuss the abundance and properties of prominent heterochromatin proteins and relate them to their potential role in driving phase transitions. Recent data from mouse fibroblasts indicate that pericentric heterochromatin is organized via a reordering transition on the level of heterochromatin regions that does not necessarily involve liquid–liquid demixing of heterochromatin proteins. Evaluating key hallmarks of the different candidate phase transition mechanisms across cell types and species will be needed to complete the current picture.