Differentiation is an epigenetic program that involves the gradual loss of pluripotency and acquisition of cell type-specific features. Understanding these processes requires genome-wide analysis of epigenetic and gene expression profiles, which have been challenging in primary tissue samples due to limited numbers of cells available. Here we describe the application of high-throughput sequencing technology for profiling histone and DNA methylation, as well as gene expression patterns of normal human mammary progenitor-enriched and luminal lineage-committed cells. We observed significant differences in histone H3 lysine 27 tri-methylation (H3K27me3) enrichment and DNA methylation of genes expressed in a cell type-specific manner, suggesting their regulation by epigenetic mechanisms and a dynamic interplay between the two processes that together define developmental potential. The technologies we developed and the epigenetically regulated genes we identified will accelerate the characterization of primary cell epigenomes and the dissection of human mammary epithelial lineage-commitment and luminal differentiation.