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Self‐renewal and pluripotency are hallmark properties of pluripotent stem cells, including embryonic stem cells (ESCs) and iPS cells. Previous studies revealed the ESC‐specific core transcription circuitry and showed that these core factors (e.g.,  Oct3/4 ,  Sox2 , and  Nanog ) regulate not only self‐renewal but also pluripotent differentiation. However, it remains elusive how these two cell states are regulated and balanced during in vitro replication and differentiation. Here, we report that the transcription elongation factor  Tcea3  is highly enriched in mouse ESCs (mESCs) and plays important roles in regulating the differentiation. Strikingly, altering  Tcea3  expression in mESCs did not affect self‐renewal under nondifferentiating condition; however, upon exposure to differentiating cues, its overexpression impaired in vitro differentiation capacity, and its knockdown biased differentiation toward mesodermal and endodermal fates. Furthermore, we identified  Lefty1  as a downstream target of  Tcea3  and showed that the  Tcea3 ‐ Lefty1 ‐Nodal‐Smad2 pathway is an innate program critically regulating cell fate choices between self‐replication and differentiation commitment. Together, we propose that  Tcea3  critically regulates pluripotent differentiation of mESCs as a molecular rheostat of Nodal‐Smad2/3 signaling. S TEM  C ELLS  2013;31:282–292

stem cells

Transcription Elongation Factor  Tcea3  Regulates the Pluripotent Differentiation Potential of Mouse Embryonic Stem Cells Via the  Lefty1 ‐Nodal‐Smad2 Pathway