Sall1 is a multi-zinc finger transcription factor that regulates kidney organogenesis. It is considered to be a transcriptional repressor, preferentially localized on heterochromatin. Mutations or deletions of the human SALL1 gene are associated with the Townes-Brocks syndrome. Despite its high expression, no function was yet assigned for Sall1 in embryonic stem (ES) cells. In the present study, we show that Sall1 is expressed in a differentiation-dependent manner and physically interacts with Nanog and Sox2, two components of the core pluripotency network. Genome-wide mapping of Sall1-binding loci has identified 591 genes, 80% of which are also targeted by Nanog. A large proportion of these genes are related to self-renewal and differentiation. Sall1 positively regulates and synergizes with Nanog for gene transcriptional regulation. In addition, our data show that Sall1 suppresses the ectodermal and mesodermal differentiation. Specifically, the induction of the gastrulation markers T brachyury, Goosecoid, and Dkk1 and the neuroectodermal markers Otx2 and Hand1 was inhibited by Sall1 overexpression during embryoid body differentiation. These data demonstrate a novel role for Sall1 as a member of the transcriptional network that regulates stem cell pluripotency.