Epigenetic mechanisms controlling adult mammalian stem cell dynamics are critical for tissue homeostasis and injury repair but are poorly understood. Defects in tissue stem cell fate choices give rise to various developmental disorders, malfunctioning of the tissue and cancers. Recent studies identified various epigenetic factors and their modifiers providing insights how the tissue stem cell fate determination is regulated during tissue regeneration. Previously, we found that adult mouse skin and hair follicle stem cells display reduced histone H3 K4me3, K9me3 and K27me3 methylation levels (hypomethylation) at a specific stage of homeostasis, preceding hair growth. To examine the physiological relevance of hypomethylation, we attempt to block it by two different methods; 1) Chemical inhibition of relevant histone demethylases and 2) Making use of a novel transgenic mouse model in which the founder transgenic mouse can subsequently produce progeny with expression of 1 in 10 distinct combinations of 3 relevant histone methyltransferases inducible in the skin epithelium. We demonstrate that interfering with hypomethylation results in subsequent impaired differentiation and growth of hair follicles and delayed wound healing. In wounding, epithelial cell differentiation and blood vessel recruitment were impaired, while epithelial cell proliferation and fibroblast recruitment were unaffected. The phenotypes associated with blocked hypomethylation are accompanied by increased BMP4 expression and selective H3 K4me3 up-regulation on the BMP4 promoter, which is known to regulate HFSC quiescence, hair cycle, and injury repair. In addition, we characterize genetic labeling tools new to skin, Aspm-CreER, and mark a major long-term self-renewing population of epidermal-specific stem cells. With these, and previously characterized Lgr5-CreER tools for the hair follicle, we demonstrate reduced contribution of epithelial SC lineages to wound healing after interfering with hypomethylation. Our results suggest that hypomethylation of histone H3 K4/9/27me3 at a specific stage of homeostasis is essential for adult skin epithelial SC dynamics for proper tissue homeostasis and repair.