When embryonic stem cells are allowed to aggregate, the outer layer of the aggregated spheres (referred to as embryoid bodies) differentiates into primitive endoderm. This initial specification of cell lineage facilitates further differentiation of the inner mass of the embryoid bodies. These processes are considered to recapitulate early embryonic development from the blastocyst stage to the egg-cylinder stage. Formation of the primitive endoderm layer in the embryoid bodies was induced solely by aggregation of embryonic stem cells, in the presence of leukemia inhibitory factor/STAT3 and serum/BMP4, which were considered to be sufficient for embryonic stem cell self-renewal. Interestingly, cell aggregation by itself induced Nanog repression at the outer layer, which was essential for aggregation-induced primitive endoderm formation. These data illustrate aggregation-based cell-fate specification during early embryonic development, when downregulation of Nanog plays a crucial role.