Development is generally viewed as one-way traffic of cell state transition from primitive to developmentally advanced states. However, molecular mechanisms that ensure the unidirectional transition of cell fates remain largely unknown. Through exact transcription start site mapping, we report an evolutionarily conserved BTB domain-containing zinc finger protein, ZBTB12, as a molecular barrier for dedifferentiation of human pluripotent stem cells (hPSCs). Single-cell RNA sequencing reveals that ZBTB12 is essential for three germ layer differentiation by blocking hPSC dedifferentiation. Mechanistically, ZBTB12 fine-tunes the expression of human endogenous retrovirus H (HERVH), a primate-specific retrotransposon, and targets specific transcripts that utilize HERVH as a regulatory element. In particular, the downregulation of HERVH-overlapping long non-coding RNAs (lncRNAs) by ZBTB12 is necessary for a successful exit from a pluripotent state and lineage derivation. Overall, we identify ZBTB12 as a molecular barrier that safeguards the unidirectional transition of metastable stem cell fates toward developmentally advanced states.