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Driving human pluripotent stem cells (hPSCs) into specific lineages is an inefficient and challenging process. We show that a potent Src inhibitor, PP1, regulates expression of genes involved in the G1 to S phase transition of the cell cycle, activates proteins in the retinoblastoma family, and subsequently increases the differentiation propensities of hPSCs into all three germ layers. We further demonstrate that genetic suppression of Src regulates the activity of the retinoblastoma protein and enhances the differentiation potential of hPSCs across all germ layers. These positive effects extend beyond the initial germ layer specification and enable efficient differentiation at subsequent stages of differentiation.