Adult stem cell quiescence is critical to ensure regeneration while minimizing tumorigenesis. Epigenetic regulation contributes to cell cycle control and differentiation, but few regulators of the chromatin state in quiescent cells are known. Here we report that the tumor suppressor PRDM2/RIZ, an H3K9 methyltransferase, is enriched in quiescent muscle stem cells in vivo and controls reversible quiescence in cultured myoblasts. We find that PRDM2 associates with >4400 promoters in G0 myoblasts, 55% of which are also marked with H3K9me2 and enriched for myogenic, cell cycle and developmental regulators. Knockdown of PRDM2 alters histone methylation at key promoters such as Myogenin and CyclinA2 (CCNA2), and subverts the quiescence program via global de-repression of myogenesis, and hyper-repression of the cell cycle. Further, PRDM2 acts upstream of the repressive PRC2 complex in G0. We identify a novel G0-specific bivalent chromatin domain in the CCNA2 locus. PRDM2 protein interacts with the PRC2 protein EZH2 and regulates its association with the bivalent domain in the CCNA2 gene. Our results suggest that induction of PRDM2 in G0 ensures that two antagonistic programs—myogenesis and the cell cycle—while stalled, are poised for reactivation. Together, these results indicate that epigenetic regulation by PRDM2 preserves key functions of the quiescent state, with implications for stem cell self-renewal.