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. Synopsis This study shows that the direct interaction between Id1 and Zrf1 blocks Zrf1 recruitment to chromatin thus impairing neural commitment of embryonic stem cells. During differentiation, Id1 levels decrease allowing Zrf1 to activate neural genes. Id1 overexpression prevents Zrf1 recruitment at target genes during neural differentiation of ESCs. Zrf1 overexpression rescues neural differentiation capacity of Id1 overexpressing ESCs. In Id1 knock‐out ESCs, Zrf1 regulates premature activation of master transcriptional regulators of neural development. Graphical Abstract This study shows that the direct interaction between Id1 and Zrf1 blocks Zrf1 recruitment to chromatin thus impairing neural commitment of embryonic stem cells. During differentiation, Id1 levels decrease allowing Zrf1 to activate neural genes.