Mouse embryonic stem cells (mESCs) have a remarkable capacity to maintain normal genome stability and karyotype in culture. We previously showed that infrequent bursts of Zscan4 expression (Z4 events) are important for the maintenance of telomere length and genome stability in mESCs. However, the molecular details of Z4 events remain unclear. Here we show that Z4 events involve unexpected transcriptional derepression in heterochromatin regions that usually remain silent. During a Z4 event, we see rapid derepression and rerepression of heterochromatin leading to a burst of transcription that coincides with transient histone hyperacetylation and DNA demethylation, clustering of pericentromeric heterochromatin around the nucleolus, and accumulation of activating and repressive chromatin remodelling complexes. This heterochromatin-based transcriptional activity suggests that mESCs may maintain their extraordinary genome stability at least in part by transiently resetting their heterochromatin.