Direct interaction between Id1 and Zrf1 controls neural differentiation of embryonic stem cells.

Id proteins are dominant-negative regulators within the HLH family of proteins. In embryonic stem cells (ESCs), Id1 and Id3 maintain the pluripotent state by preventing neural differentiation. The Id1-interacting protein Zrf1 plays a crucial role as a chromatin-bound factor in specification of the neural fate from ESCs. Here, we show that Id1 blocks Zrf1 recruitment to chromatin, thus preventing the activation of neural genes in ESCs. Upon differentiation, Id1 expression decreases thus inducing Zrf1 binding to neural genes. Importantly, depletion of Zrf1 rescues the expression of Polycomb targets involved in neural specification which are up-regulated in Id1 knock-out ESCs. We therefore identified Zrf1 as transcriptional regulator of neural fate downstream of Id1 in ESCs.