Recent studies have provided substantial evidence supporting Ohno's hypothesis that upregulation of active X chromosome genes balances the dosage of X-linked gene expression relative to autosomal genes. However, the dynamics of X-chromosome upregulation (XCU) during early development remain poorly understood. Here, we have profiled the dynamics of XCU in different lineages of female pre-gastrulation mouse embryos at single cell level through allele-specific single cell RNA-seq analysis. We found dynamic XCU upon initiation of random X-chromosome inactivation (XCI) in epiblast cells and cells of extraembryonic lineages, which undergo imprinted XCI, also harbored upregulated active-X chromosome. On the other hand, the extent of XCU remains controversial till date. While it is thought that it is a global phenomenon, some studies suggested that it affects dosage sensitive genes only. Interestingly, through profiling gene-wise dynamics of XCU, we found that X-upregulation is not global and primarily belongs to ancestral X-linked genes. However, it is not fully restricted to ancestral X-linked genes as some of newly acquired X-linked genes also undergo XCU, suggesting evolution of XCU to the newly acquired genes as well. Importantly, we found that occupancy of RNApolII, H3k4me3, H4k16ac and H3K36me3 is enhanced at loci of the upregulated/ancestral genes compared to non-upregulated/newly acquired X-linked genes. Moreover, upregulated X-linked genes showed increased burst frequency compared to the non-upregulated genes. Altogether, our study provides significant insight into the gene-wise dynamics, mechanistic basis, and evolution of XCU during early development.