LIN28-mediated processing of the microRNA (miRNA) let-7 has emerged as a multilevel program that controls self-renewal in embryonic stem cells. LIN28A is believed to act primarily in the cytoplasm together with TUT4/7 to prevent final maturation of let-7 by Dicer, whereas LIN28B has been suggested to preferentially act on nuclear processing of let-7. Here, we find that SET7/9 monomethylation in a putative nucleolar localization region of LIN28A increases its nuclear retention and protein stability. In the nucleoli of human embryonic stem cells, methylated LIN28A sequesters pri-let-7 and blocks its processing independently of TUT4/7. The nuclear form of LIN28A regulates transcriptional changes in MYC-pathway targets, thereby maintaining stemness programs and inhibiting expression of early lineage-specific markers. These findings provide insight into the molecular mechanism underlying the post-translational methylation of nuclear LIN28A and its ability to modulate pluripotency by repressing let-7 miRNA expression in human embryonic stem cells.