In embryonic stem cells, extracellular signals are required to derepress developmental promoters to drive lineage specification, but the proteins involved in connecting extrinsic cues to relaxation of chromatin remain unknown. We demonstrate that the helix-loop-helix (HLH) protein, HEB, directly associates with the Polycomb repressive complex 2 (PRC2) at a subset of developmental promoters, including at genes involved in mesoderm and endoderm specification and at the Hox and Fox gene families. While we show that depletion of HEB does not affect mouse ESCs, it does cause premature differentiation after exposure to Activin. Further, we find that HEB deposition at developmental promoters is dependent upon PRC2 and independent of Nodal, whereas HEB association with SMAD2/3 elements is dependent of Nodal, but independent of PRC2. We suggest that HEB is a fundamental link between Nodal signalling, the derepression of a specific class of poised promoters during differentiation, and lineage specification in mouse ESCs.