Embryonic stem cell (ESC) self-renewal efficiency is determined by the level of Nanog expression. However, the mechanisms by which Nanog functions remain unclear, and in particular, direct Nanog target genes are uncharacterized. Here we investigate ESCs expressing different Nanog levels and Nanog-/- cells with distinct functionally inducible Nanog proteins to identify Nanog-responsive genes. Surprisingly, these constitute a minor fraction of genes that Nanog binds. Prominent among Nanog-reponsive genes is Estrogen-related receptor b (Esrrb). Nanog binds directly to Esrrb, enhances binding of RNAPolII, and stimulates Esrrb transcription. Overexpression of Esrrb in ESCs maintains cytokine-independent self-renewal and pluripotency. Remarkably, this activity is retained in Nanog-/- ESCs. Moreover, Esrrb can reprogram Nanog-/- EpiSCs and can rescue stalled reprogramming in Nanog-/- pre-iPSCs. Finally, Esrrb deletion abolishes the defining ability of Nanog to confer LIF-independent ESC self-renewal. These findings are consistent with the functional placement of Esrrb downstream of Nanog.