UPF1 and LIN28A are RNA-binding proteins involved in post-transcriptional regulation and stem cell differentiation. Most studies on UPF1 and LIN28A have focused on the molecular mechanisms of differentiated cells and stem cell differentiation, respectively. We reveal that LIN28A directly interacts with UPF1 before UPF1-UPF2 complexing, thereby reducing UPF1 phosphorylation and inhibiting nonsense-mediated mRNA decay (NMD). We identify the interacting domains of UPF1 and LIN28A; moreover, we develop a peptide that impairs UPF1-LIN28A interaction and augments NMD efficiency. Transcriptome analysis of human pluripotent stem cells (hPSCs) confirms that the levels of NMD targets are significantly regulated by both UPF1 and LIN28A. Inhibiting the UPF1-LIN28A interaction using a CPP-conjugated peptide promotes spontaneous differentiation by repressing the pluripotency of hPSCs during proliferation. Furthermore, the UPF1-LIN28A interaction specifically regulates transcripts involved in ectodermal differentiation. Our study reveals that transcriptome regulation via the UPF1-LIN28A interaction in hPSCs determines cell fate.