Ewing sarcoma is an aggressive cancer of bone and soft tissue in children. It is characterized by the chromosomal translocation between EWS and an Ets family transcription factor, most commonly FLI1. We recently reported that Ewing sarcoma depends on the autocrine signaling mediated by a cytokine, NELL2. NELL2 signaling stimulates the transcriptional output of EWS-FLI1 through the BAF chromatin remodeling complexes. While studying the impact of NELL2 silencing on Ewing sarcoma, we found that suppression of NELL2 signaling induces the expression of endogenous retroviruses (ERVs) and LINE-1 retrotransposons, an interferon response, and growth arrest. We determined that a histone methyltransferase, EZH2, is the critical downstream target of NELL2 signaling in suppressing ERVs, LINE-1, an interferon response, and growth arrest. We show that EZH2 inhibitors induce ERVs, LINE-1, and an interferon response in a variety of cancer types. These results uncover the role for NELL2-EZH2 signaling in suppressing endogenous virus-like agents and an antiviral response, and suggest the potential utility of EZH2 inhibitors in enhancing anti-tumor immunity.