The death inducer obliterator (Dido) locus encodes three protein isoforms, of which Dido3 is the largest and most broadly expressed. Dido3 is a nuclear protein that forms part of the spindle assembly checkpoint (SAC) and is necessary for correct chromosome segregation in somatic and germ cells. Here we report that specific ablation of Dido3 function in mice causes lethal developmental defects at the onset of gastrulation. Although these defects are associated with centrosome amplification, spindle malformation and a DNA damage response, we provide evidence that embryonic lethality of the Dido3 mutation cannot be explained by its impact on chromosome segregation alone. We show that loss of Dido3 expression compromises differentiation of embryonic stem cells in vitro and of epiblast cells in vivo, resulting in early embryonic death at around day 8.5 of gestation. Close analysis of Dido3 mutant embryoid bodies indicates that ablation of Dido3, rather than producing a generalized differentiation blockade, delays the onset of lineage commitment at the primitive endoderm specification stage. The dual role of Dido3 in chromosome segregation and stem cell differentiation supports the implication of SAC components in stem cell fate decisions.