ZNF462haploinsufficiency is linked to Weiss–Kruszka syndrome, a genetic disorder characterized by neurodevelopmental defects, including autism. Though conserved in vertebrates and essential for embryonic development, the molecular functions of ZNF462remain unclear. We identified its murine homologue ZFP462 in a screen for mediators of epigenetic gene silencing. Here we show that ZFP462 safeguards neural lineage specification of mouse embryonic stem cells (ESCs) by targeting the H3K9-specific histone methyltransferase complex G9A/GLP to silence meso-endodermal genes. ZFP462 binds to transposable elements that are potential enhancers harbouring pluripotency and meso-endoderm transcription factor binding sites. Recruiting G9A/GLP, ZFP462 seeds heterochromatin, restricting transcription factor binding. Loss of ZFP462 in ESCs results in increased chromatin accessibility at target sites and ectopic expression of meso-endodermal genes. Taken together, ZFP462 confers lineage and locus specificity to the broadly expressed epigenetic regulator G9A/GLP. Our results suggest that aberrant activation of lineage non-specific genes in the neuronal lineage underlies ZNF462-associated neurodevelopmental pathology.