Diverse histone modifications are catalysed and recognized by various specific proteins, establishing unique modification patterns that act as transcription signals. In particular, histone H3 trimethylation at lysine 36 (H3K36me3) is associated with actively transcribed regions and has been proposed to provide landmarks for continuing transcription; however, the control mechanisms and functions of H3K36me3 in higher eukaryotes are unknown. Here we show that the H3K36me3-specific histone methyltransferase (HMTase) Wolf-Hirschhorn syndrome candidate 1 (WHSC1, also known as NSD2 or MMSET) functions in transcriptional regulation together with developmental transcription factors whose defects overlap with the human disease Wolf-Hirschhorn syndrome (WHS). We found that mouse Whsc1, one of five putative Set2 homologues, governed H3K36me3 along euchromatin by associating with the cell-type-specific transcription factors Sall1, Sall4 and Nanog in embryonic stem cells, and Nkx2-5 in embryonic hearts, regulating the expression of their target genes. Whsc1-deficient mice showed growth retardation and various WHS-like midline defects, including congenital cardiovascular anomalies. The effects of Whsc1 haploinsufficiency were increased in Nkx2-5 heterozygous mutant hearts, indicating their functional link. We propose that WHSC1 functions together with developmental transcription factors to prevent the inappropriate transcription that can lead to various pathophysiologies.