Pluripotent stem cells (PSCs) contain functionally immature mitochondria and rely upon high rates of glycolysis for their energy requirements. Thus, altered mitochondrial function and promotion of aerobic glycolysis is key to maintain and induce pluripotency. However, signaling mechanisms that regulate mitochondrial function and reprogram metabolic preferences in self-renewing vs. differentiated PSC populations are poorly understood. Here, using murine embryonic stem cells (ESCs) as a model system, we demonstrate that atypical protein kinase C isoform, PKC lambda/iota (PKCλ/ι), is a key regulator of mitochondrial function in ESCs. Depletion of PKCλ/ι in ESCs maintains their pluripotent state as evident from germline offsprings. Interestingly, loss of PKCλ/ι in ESCs leads to impairment in mitochondrial maturation, organization and a metabolic shift toward glycolysis under differentiating condition. Our mechanistic analyses indicate that a PKCλ/ι-HIF1α-PGC1α axis regulates mitochondrial respiration and balances pluripotency in ESCs. We propose that PKCλ/ι could be a crucial regulator of mitochondrial function and energy metabolism in stem cells and other cellular contexts.