Embryonic stem cells (ESCs) possess the capacity to self-renew and differentiate into all cell types of an organism. It is essential to understand how these properties are controlled for the potential usage of their derivatives in clinical settings and reprogramming of differentiated somatic cells. Although transcriptional factors, such as Oct4, Sox2, and Nanog, have been considered as a part of the core regulatory circuitry, a growing body of evidence suggests that additional factors exist and contribute to the control of ESC self-renewal and differentiation. Here, we report that Ly-1 antibody reactive clone (LYAR), a zinc finger nucleolar protein highly expressed in undifferentiated ESCs, plays a critical role in maintaining ESC identity. Its downregulation significantly reduces the rate of ESC growth and increases their apoptosis. Moreover, reduced expression of LYAR in ESCs impairs their differentiation capacity, failing to rapidly silence pluripotency markers and to activate differentiation genes upon differentiation. Mechanistically, LYAR forms a complex with another nucleolar protein, nucleolin, and prevents its self-cleavage, maintaining a normal steady-state level of nucleolin protein in undifferentiated ESCs. Interestingly, the downregulation of nucleolin is detrimental to the growth of ESCs and increases the rate of apoptosis, similarly to the knockdown of LYAR. Thus, our data emphasize the fact that other genes besides Oct4 and Nanog are uniquely required for ESC self-renewal and differentiation and demonstrate that LYAR functions to control the stability of nucleolin protein, which in turn is essential for maintaining the self-renewal of ESCs. © AlphaMed Press.