The transcription factor Nanog is uniquely expressed in embryonic stem (ES) cells and in germ cell tumors and is important for self-renewal. To understand the relation between this and cell transformation, we expressed Nanog in NIH3T3 cells, and these cells showed an increased growth rate and a transformed phenotype as demonstrated by foci formation and colony growth in soft agar. This suggests that Nanog possesses an oncogenic potential that may be related to the role it plays in germ cell tumors and to its function in self renewal of ES cells. We studied the transcription targets of Nanog using microarrays to identify Nanog regulated genes. The list of genes regulated by Nanog was unique for each cell type and more than 10% of the Nanog regulated genes, including transcription factors, are primary Nanog targets since their promoters bind Nanog in ES cells. Some of these target genes can explain the transformation of NIH3T3.