The resurrection of pseudogenes during evolution produced lncRNAs with new biological function. Here we show that pseudogene-evolution created an Oct4 pseudogene lncRNA that is able to direct epigenetic silencing of the parental Oct4 gene via a 2-step, lncRNA dependent mechanism. The murine Oct4 pseudogene 4 (mOct4P4) lncRNA recruits the RNA binding protein FUS to allow the binding of the SUV39H1 HMTase to a defined mOct4P4 lncRNA sequence element. The mOct4P4-FUS-SUV39H1 silencing complex holds target site specificity for the parental Oct4 promoter and interference with individual components results in loss of Oct4 silencing. SUV39H1 and FUS do not bind parental Oct4 mRNA, confirming the acquisition of a new biological function by the mOct4P4 lncRNA. Importantly, all features of mOct4P4 function are recapitulated by the human hOCT4P3 pseudogene lncRNA, indicating evolutionary conservation. Our data highlight the biological relevance of rapidly evolving lncRNAs that infiltrate into central epigenetic regulatory circuits in vertebrate cells.