Understanding the mechanism by which embryonic stem (ES) cells self-renew is crucial for the realization of their therapeutic potential. Earlier, overexpression of Id proteins was shown to be sufficient to maintain mouse ES cells in a self-renewing state even in the absence of serum. Here, we use ES cells derived from Id deficient mice to investigate the requirement for Id proteins in maintaining ES cell self-renewal. We find that Id1^−/− ES cells have a defect in self-renewal and a propensity to differentiate. We observe that chronic or acute loss of Id1 leads to a down-regulation of Nanog, a critical regulator of self-renewal. In addition, in the absence of Id1, ES cells express elevated levels of Brachyury, a marker of mesendoderm differentiation. We find that loss of both Nanog and Id1 is required for the up-regulation of Brachyury, and ectopic Nanog expression in Id1^−/− ES cells rescues the self-renewal defect, indicating that Nanog is the major downstream target of Id1. These results identify Id1 as a critical factor in the maintenance of ES cell self-renewal and suggest a plausible mechanism for its control of lineage commitment.