The histone variant macroH2A1 (mH2A1) is involved in cellular growth, differentiation and reprogramming, but the underlying molecular mechanisms are a matter of debate. Different roles of mH2A1 in gene expression may relate to functional differences of its two splicing isoforms, mH2A1.1 and mH2A1.2. Here, we map for the first time genome-wide localization of endogenous mH2A1.1 and link the distribution of mH2A1.1 to control of gene expression in human breast cancer cells. In addition to localization shared with mH2A1.2 to facultative heterochromatin, mH2A1.1 specifically associates with regulatory elements required for gene activation, super-enhancers and promoters of highly expressed genes. Depending on the recruitment profile of mH2A1.1 to these elements, selective depletion of mH2A1.1 up- or downregulates its target genes. mH2A1.1 represses transcription when its binding is spread over the entire gene and promoter, and activates transcription when its binding is strictly confined to the transcription start site (TSS). Notably, RNA Polymerase II was frequently in pause at mH2A1.1-activated genes. Functionally, mH2A1.1-dependent regulation of a subset of paused genes impedes mammary tumor cell migration. Molecular mechanisms of mH2A1.1 function at the TSS uncovered by our study define an intriguing new mode of transcription regulation in cancer cells.