Cell fate during development is defined by transcription factors that act as molecular switches to activate or repress specific gene expression programmes. The POU transcription factor Oct-3/4 (encoded by Pou5f1) is a candidate regulator in pluripotent and germline cells 1, 2, 3, 4 and is essential for the initial formation of a pluripotent founder cell population in the mammalian embryo 5. Here we use conditional expression and repression in embryonic stem (ES) cells to determine requirements for Oct-3/4 in the maintenance of developmental potency. Although transcriptional determination has usually been considered as a binary on-off control system, we found that the precise level of Oct-3/4 governs three distinct fates of ES cells. A less than twofold increase in expression causes differentiation into primitive endoderm and mesoderm. In contrast, repression of Oct-3/4 induces loss of pluripotency and dedifferentiation to trophectoderm. Thus a critical amount of Oct-3/4 is required to sustain stem-cell self-renewal, and up-or downregulation induce divergent developmental programmes. Our findings establish a role for Oct-3/4 as a master regulator of pluripotency that controls lineage commitment and illustrate the sophistication of critical transcriptional regulators and the consequent importance of quantitative analyses.