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Understanding the mechanisms regulating pluripotency in embryonic and induced pluripotent stem cells is required to ensure their safe use in clinical applications. Glycogen synthase kinase-3 (GSK-3) has emerged as an important regulator of pluripotency, based primarily on studies with small-molecule GSK-3 inhibitors. Here, we use mouse embryonic stem cells (ESCs) lacking GSK-3 to demonstrate that a single GSK-3 substrate, β-catenin, controls the ability of ESCs to exit the pluripotent state and to differentiate into neurectoderm. Unexpectedly, the effects of β-catenin on pluripotency do not appear to be dependent on TCF-mediated signaling, based on experiments utilizing a β-catenin C-terminal truncation mutant or highly efficient dominant-negative TCF strategies. Alternatively, we find that stabilized β-catenin forms a complex with and enhances the activity of Oct-4, a core component of the transcriptional network regulating pluripotency. Collectively, our data suggest previously underappreciated, divergent TCF-dependent and TCF-independent roles for β-catenin in ESCs.