Increasing evidence suggests that epigenetic regulation is key to the maintenance of the stem cell state. Chromatin is the physiological form of eukaryotic genomes and the substrate for epigenetic marking, including DNA methylation, post-translational modifications of histones and the exchange of core histones with histone variants. The chromatin template undergoes significant reorganization during embryonic stem cell (ESC) differentiation and somatic cell reprogramming (SCR). Intriguingly, remodeling of the epigenome appears to be a crucial barrier that must be surmounted for efficient SCR. This area of research has gained significant attention due to the importance of ESCs in modeling and treating human disease. Here we review the epigenetic mechanisms that are key for maintenance of the ESC state, ESC differentiation and SCR. We focus on murine and human ESCs and induced pluripotent stem cells, and highlight the pharmacological approaches used to study or manipulate cell fate where relevant.