Cytosine DNA methylation is a heritable epigenetic mark present in many eukaryotes. The mammalian genome undergoes tightly regulated global demethylation early development where faithfully inherited DNA methylations are essential. In adult soma, while DNA methylation is largely stable, its aberrations have been widely observed in aged and malignant tissues. Under these conditions, broad hypomethylated domains have been observed at gene deserts and genomic repeats, a phenomenon linked to excessive proliferations. In the meantime, focal hypermethylation occurs at lineage specific promoters, accompanied by widespread methylation variations at conserved regulatory loci. The molecular basis and functional consequences for these DNA methylation abnormality in adult tissues remain poorly understood. In the current study, we investigate the role of DNA methylation in determining adult stem cell fates under homeostasis and upon stress. In particular, we focus on the regulation of retrotransposons (RTs) by DNA methylation and how their impact adult stem cell function. Differing from tandem repeats in the centromere and telomere that are constitutively heterochromatin, RTs are interspersed genomic repeats that exist in both heterochromatin and euchromatin state. Compared to protein-coding genes comprising 1.5% of the genome, RTs constitute 40% of the genome and exert many regulatory functions, but are understudied due to their sequence repetitiveness and less conserved nature. During pre-implantation, RTs residing in the heterochromatin are transiently derepressed due to global demethylation and play an essential role in embryonic development. In adult somatic tissues, RTs are largely suppressed but become aberrantly induced when heterochromatin is destabilized, such as during aging and cancer. What pathways control RT levels in adult tissues, their impact on lineage gene expressions, and their physiological role under homeostasis and upon stress remain unclear. To address these questions, we use mouse skin as our model that harbors well-characterized, highly accessible, and genetically amenable adult stem cells. Epidermal and hair follicle stem cells in the skin fuel the homeostatic postnatal remodeling, drive wound induced regeneration, and undergo functional decline during aging. By using genetic models lacking what we have found to be a crucial epigenetic repressor of RTs in adult skin, we examine (1) the molecular basis for DNA and histone methylation mediated RT silencing, and (2) the mechanism by which DNA methylation and RT dynamics regulate adult stem cell fate decision in a physiological setting. We hypothesize that DNA methylation at RTs could either locally impact neighbor gene expressions or titrate rate limiting methylation machinery to regulate lineage gene levels at a distance, both of which contributing to adult stem cell fate decisions. Our study will provide insights into the molecular interconnection between euchromatin and heterochromat...