The epigenome changes that underlie cellular differentiation in developing organisms are poorly understood. To gain insights into how pancreatic beta-cells are programmed, we profiled key histone methylations and transcripts in embryonic stem cells, multipotent progenitors of the nascent embryonic pancreas, purified beta-cells, and 10 differentiated tissues. We report that despite their endodermal origin, beta-cells show a transcriptional and active chromatin signature that is most similar to ectoderm-derived neural tissues. In contrast, the beta-cell signature of trimethylated H3K27, a mark of Polycomb-mediated repression, clusters with pancreatic progenitors, acinar cells and liver, consistent with the epigenetic transmission of this mark from endoderm progenitors to their differentiated cellular progeny. We also identified two H3K27 methylation events that arise in the beta-cell lineage after the pancreatic progenitor stage. One is a wave of cell-selective de novo H3K27 trimethylation in non-CpG island genes. Another is the loss of bivalent and H3K27me3-repressed chromatin in a core program of neural developmental regulators that enables a convergence of the gene activity state of beta-cells with that of neural cells. These findings reveal a dynamic regulation of Polycomb repression programs that shape the identity of differentiated beta-cells.