Enhancer of zeste 2 (Ezh2), a SET domain-containing protein, is crucial for development in many model organisms, including early mouse development. In mice, Ezh2 is detected as a maternally inherited protein in the oocyte but its function at the onset of development is unknown. We have used a conditional allele of Ezh2 to deplete the oocyte of this maternal inheritance. We show that the loss of maternal Ezh2 has a long-term effect causing severe growth retardation of neonates despite `rescue' through embryonic transcription from the paternal allele. This phenotypic effect on growth could be attributed to the asymmetric localisation of the Ezh2/Eed complex and the associated histone methylation pattern to the maternal genome, which is disrupted in Ezh2 mutant zygotes. During subsequent development, we detect distinct histone methylation patterns in the trophectoderm and the pluripotent epiblast. In the latter where Oct4 expression continues from the zygote onwards, the Ezh2/Eed complex apparently establishes a unique epigenetic state and plasticity, which probably explains why loss of Ezh2 is early embryonic lethal and obligatory for the derivation of pluripotent embryonic stem cells. By contrast, in the differentiating trophectoderm cells where Oct4 expression is progressively downregulated Ezh2/Eed complex is recruited transiently to one X chromosome in female embryos at the onset of X-inactivation. This accumulation and the associated histone methylation are also lost in Ezh2 mutants, suggesting a role in X inactivation. Thus,Ezh2 has significant and diverse roles during early development, as well as during the establishment of the first differentiated cells, the trophectoderm,and of the pluripotent epiblast cells.