DNA methylation and demethylation have been proposed to play an important role in somatic cell reprogramming. Here, we demonstrate that the DNA hydroxylase Tet1 facilitates pluripotent stem cell induction by promoting Oct4 demethylation and reactivation. Moreover, Tet1 (T) can replace Oct4 and initiate somatic cell reprogramming in conjunction with Sox2 (S), Klf4 (K), and c-Myc (M). We established an efficient TSKM secondary reprogramming system and used it to characterize the dynamic profiles of 5-methylcytosine (5mC), 5-hydroxymethylcytosine (5hmC), and gene expression during reprogramming. Our analysis revealed that both 5mC and 5hmC modifications increased at an intermediate stage of the process, correlating with a transition in the transcriptional profile. We also found that 5hmC enrichment is involved in the demethylation and reactivation of genes and regulatory regions that are important for pluripotency. Our data indicate that changes in DNA methylation and hydroxymethylation play important roles in genome-wide epigenetic remodeling during reprogramming.