Nanog expression is heterogeneous and dynamic in embryonic stem cells (ESCs). However, the mechanism for stabilizing pluripotency during the transitions between Nanog(high) and Nanog(low) states is not well understood. Here we report that Dax1 acts in parallel with Nanog to regulate mouse ESC (mESCs) identity. Dax1 stable knockdown mESCs are predisposed towards differentiation but do not lose pluripotency, whereas Dax1 overexpression supports LIF-independent self-renewal. Although partially complementary, Dax1 and Nanog function independently and cannot replace one another. They are both required for full reprogramming to induce pluripotency. Importantly, Dax1 is indispensable for self-renewal of Nanog(low) mESCs. Moreover, we report that Dax1 prevents extra-embryonic endoderm (ExEn) commitment by directly repressing Gata6 transcription. Dax1 may also mediate inhibition of trophectoderm differentiation independent or as a downstream effector of Oct4. These findings establish a basal role of Dax1 in maintaining pluripotency during the state transition of mESCs and somatic cell reprogramming.