Acquisition of pluripotency is driven largely at the transcriptional level by activators OCT4, SOX2, and NANOG that must in turn cooperate with diverse coactivators to execute stem cell-specific gene expression programs. Using a biochemically defined in vitro transcription system that mediates OCT4/SOX2 and coactivator-dependent transcription of the Nanog gene, we report the purification and identification of the dyskerin (DKC1) ribonucleoprotein complex as an OCT4/SOX2 coactivator whose activity appears to be modulated by a subset of associated small nucleolar RNAs (snoRNAs). The DKC1 complex occupies enhancers and regulates the expression of key pluripotency genes critical for self-renewal in embryonic stem (ES) cells. Depletion of DKC1 in fibroblasts significantly decreased the efficiency of induced pluripotent stem (iPS) cell generation. This study thus reveals an unanticipated transcriptional role of the DKC1 complex in stem cell maintenance and somatic cell reprogramming. DOI: http://dx.doi.org/10.7554/eLife.03573.001, eLife digest The stem cells found in an embryo are able to develop into any of the cell types found in the body of the animal: an ability called pluripotency. When a cell becomes a specialized cell type, such as a nerve cell or a muscle cell, it loses this ability. However, mature cells can be reprogrammed back to a pluripotent state by artificially introducing certain proteins (known as ‘reprogramming factors’) into the mature cells. A core group of reprogramming factors are known to activate networks of genes that are normally only expressed in stem cells, and by doing so trigger and maintain a pluripotent state. Other proteins help these core factors to regulate these networks of genes. In 2011, researchers discovered that a protein complex called XPC—which is normally involved in DNA repair—also helps two core reprogramming factors to activate an important gene related to pluripotency. Now, Fong et al., including several of the researchers involved in the 2011 work, have identified another unexpected partner for the same two core reprogramming factors. The protein complex, called DKC1, has a number of known functions related to the processing of RNA molecules. This complex has also been linked to a fatal, rare human disorder called dyskeratosis congenita—a condition that affects many parts of the body, including the skin and bone marrow. Fong et al. found that when embryonic stems cells from mice are depleted of the DKC1 complex, the activation of important pluripotency-related genes by two of the core reprogramming factors is markedly reduced. The XPC and DKC1 protein complexes were found to interact in pluripotent cells, and together they can activate a pluripotency-related gene to a greater extent than either can individually. Fong et al. propose that DKC1 binds to XPC, which in turn binds to two of the core reprogramming factors. The DKC1 complex also binds to RNA molecules, and Fong et al. found that when the DKC1 complex binds to certain RNAs it is more able to help reprogramming factors activate pluripotency-related genes. On the other hand, other RNA molecules seem to inhibit the complex's ability to activate these genes. Mutations identified in people with dyskeratosis congenita can prevent the DKC1 complex from binding to a subset of human RNA molecules. Moreover, the activity of stem cells is impaired in people with this developmental condition. As such, one of the next challenges will be to investigate if these mutations and RNA binding could be linked to problems with the activation of genes related to pluripotency in stem cells. DOI: http://dx.doi.org/10.7554/eLife.03573.002