The first cell differentiation event in mammalian embryogenesis segregates inner cell mass lineage from the trophectoderm at the blastocyst stage. Oct-4, a member of the POU family of transcription factors, is necessary for the pluripotency of the inner cell mass lineage. Embryonic stem (ES) cells, which contribute to all of embryonic lineages, express the Oct-4 gene. Trophoblast stem (TS) cells, which have the ability to differentiate into trophoblast lineage in vitro, never contribute to embryonic proper tissues in chimeras and differentiate only into trophoblastic cells in the placenta. Expression of the Oct-4 gene was undetectable and severely repressed in trophoblastic lineage, including the stem cells. We found that the culture of TS cells with 5-aza-2'-deoxycytidine or trichostatin A caused the activation of the Oct-4 gene. Analysis of the DNA methylation status of mouse Oct-4 gene upstream region revealed that Oct-4 enhancer/promoter region was hypomethylated in ES cells but hypermethylated in TS cells. Furthermore, in vitro methylation suppressed Oct-4 enhancer/promoter activity in reporter assay. In the placenta of Dnmt1(n/n) mutant mice, most of the CpGs in the enhancer/promoter region were unmethylated, and Oct-4 gene expression was aberrantly detected. Chromatin immunoprecipitation assay revealed that Oct-4 enhancer/promoter region was hyperacetylated in ES cells compared with TS cells, thus demonstrating that DNA methylation status is closely linked to the chromatin structure of the Oct-4 gene. Here we propose that the epigenetic mechanism, consisting of DNA methylation and chromatin remodeling, underlies the developmental stage- and cell type-specific mechanism of Oct-4 gene expression.