The Zinc-finger protein of the cerebellum 2 (Zic2) is one of the vertebrate homologs of the Drosophila pair-rule gene odd-paired (opa). Our molecular and biochemical studies demonstrate that Zic2 preferentially binds to transcriptional enhancers and is required for the regulation of gene expression in embryonic stem cells. Detailed genome-wide and molecular studies reveal that Zic2 can function with Mbd3/NuRD in regulating the chromatin state and transcriptional output of genes linked to differentiation. Zic2 is required for proper differentiation of embryonic stem cells (ESCs), similar to what has been previously reported for Mbd3/NuRD. Our study identifies Zic2 as a key factor in the execution of transcriptional fine-tuning with Mbd3/NuRD in ESCs through interactions with enhancers. Our study also points to the role of the Zic family of proteins as enhancer-specific binding factors functioning in development.
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