In mice, pluripotent cells are thought to derive from cells buried inside the embryo around the 16-cell stage. Sox2 is the only pluripotency gene known to be expressed specifically within inside cells at this stage. To understand how pluripotency is established, we therefore investigated the mechanisms regulating the initial activation of Sox2 expression. Surprisingly, Sox2 expression initiated normally in the absence of both Nanog and Oct4 (Pou5f1), highlighting differences between embryo and stem cell models of pluripotency. However, we observed precocious, ectopic expression of Sox2 prior to the 16-cell stage in the absence of Yap1, Wwtr1, and Tead4. Interestingly, the repression of premature Sox2 expression was sensitive to LATS1/2 activity, even though LATS1/2 normally do not limit TEAD4/YAP1/WWTR1 activity during these early stages. Finally, we present evidence for direct transcriptional repression of Sox2 by YAP1/WWTR1/TEAD4. Taken together, our observations reveal that, while embryos are initially competent to express Sox2 as early as the 4-cell stage, transcriptional repression prevents the premature expression of Sox2, thereby restricting the pluripotency program to the stage when inside cells are first created.