DNA methylation (DNAme; 5-methylcytosine, 5mC) plays an essential role in mammalian development, and the 5mC profile is regulated by a balance of opposing enzymatic activities: DNA methyltransferases (DNMTs) and Ten-eleven translocation dioxygenases (TETs). In mouse embryonic stem cells (ESCs), de novo DNAme by DNMT3 family enzymes, demethylation by the TET-mediated conversion of 5mC to 5-hydroxymethylation (5hmC), and maintenance of the remaining DNAme by DNMT1 are actively repeated throughout cell cycles, dynamically forming a constant 5mC profile. Nevertheless, the detailed mechanism and physiological significance of this active cyclic DNA modification in mouse ESCs remain unclear. Here by visualizing the localization of DNA modifications on metaphase chromosomes and comparing whole-genome methylation profiles before and after the mid-S phase in ESCs lacking Dnmt1 (1KO ESCs), we demonstrated that in 1KO ESCs, DNMT3-mediated remethylation was interrupted during and after DNA replication. This results in a marked asymmetry in the distribution of 5hmC between sister chromatids at mitosis, with one chromatid being almost no 5hmC. When introduced in 1KO ESCs, the catalytically inactive form of DNMT1 (DNMT1CI) induced an increase in DNAme in pericentric heterochromatin and the DNAme-independent repression of IAPEz, a retrotransposon family, in 1KO ESCs. However, DNMT1CI could not restore the ability of DNMT3 to methylate unmodified dsDNA de novo in S phase in 1KO ESCs. Furthermore, during in vitro differentiation into epiblasts, 1KO ESCs expressing DNMT1CI showed an even stronger tendency to differentiate into the primitive endoderm than 1KO ESCs and were readily reprogrammed into the primitive streak via an epiblast-like cell state, reconfirming the importance of DNMT1 enzymatic activity at the onset of epiblast differentiation. These results indicate a novel function of DNMT1, in which DNMT1 actively regulates the timing and genomic targets of de novo methylation by DNMT3 in an enzymatic activity-dependent and independent manner, respectively.