The mRNA cap recruits factors essential for transcript processing and translation initiation. We report that regulated mRNA cap methylation is a feature of embryonic stem cell (ESC) differentiation. Expression of the mRNA cap methyltransferase activating subunit, RAM, is elevated in ESCs resulting in high levels of mRNA cap methylation and expression of Oct4 and Sox2 and other pluripotency-associated factors. During neural differentiation, RAM is suppressed which is required for loss of Oct4 and Sox2 and correct expression of neural markers. Cells were treated with control or RAM siRNA and cytosolic RNA or polysome RNA (actively translated) was sequenced.