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Mitotic bookmarking transcription factors remain bound to chromosomes during mitosis and were proposed to regulate phenotypic maintenance of stem and progenitor cells at the mitosis-to-G1 (M-G1) transition. However, mitotic bookmarking remains largely unexplored in most stem cell types, and its functional relevance for cell fate decisions remains unclear. Here we screened for mitotic chromosome binding within the pluripotency network of embryonic stem (ES) cells and show that SOX2 and OCT4 remain bound to mitotic chromatin through their respective DNA-binding domains. Dynamic characterization using photobleaching-based methods and single-molecule imaging revealed quantitatively similar specific DNA interactions, but different nonspecific DNA interactions, of SOX2 and OCT4 with mitotic chromatin. Using ChIP-seq (chromatin immunoprecipitation [Chill combined with high-throughput sequencing) to assess the genome-wide distribution of SOX2 on mitotic chromatin, we demonstrate the bookmarking activity of SOX2 on a small set of genes. Finally, we investigated the function of SOX2 mitotic bookmarking in cell fate decisions and show that its absence at the M-G1 transition impairs pluripotency maintenance and abrogates its ability to induce neuroectodermal differentiation but does not affect reprogramming efficiency toward induced pluripotent stem cells. Our study demonstrates the mitotic bookmarking property of SOX2 and reveals its functional importance in pluripotency maintenance and ES cell differentiation.