Maternal-effect mutations in NLRP7 cause rare biparentally inherited hydatidiform moles (BiHMs), abnormal pregnancies containing hypertrophic vesicular trophoblast but no embryo. BiHM trophoblasts display abnormal DNA methylation patterns affecting maternally methylated germline differentially methylated regions (gDMRs), suggesting that NLRP7 plays an important role in reprogramming imprinted gDMRs. How NLRP7-a component of the CATERPILLAR family of proteins involved in innate immunity and apoptosis-causes these specific DNA methylation and trophoblast defects is unknown. Because rodents lack NLRP7, we used human embryonic stem cells to study its function and demonstrate that NLRP7 interacts with YY1, an important chromatin-binding factor. Reduced NLRP7 levels alter DNA methylation and accelerate trophoblast lineage differentiation. NLRP7 thus appears to function in chromatin reprogramming and DNA methylation in the germline or early embryonic development, functions not previously associated with members of the NLRP family.